AI in Health Insurance

Posted on: Jan 2, 2025 | 3 mins | Written by: HDFC ERGO Team

AI in Health Insurance

Today, technology has a role in almost every aspect of our lives. Whether filling out a simple application form or asking complex health-related queries, technology is making even the most intricate processes more manageable and efficient. In recent years, one area where this transformation is becoming increasingly visible is health insurance.

A few years ago, if you wanted to buy a health insurance plan or compare the offerings of different insurers, you would have had to spare days from your hectic schedule to visit branch offices or medical service providers to resolve your queries. But today, technology, particularly in the form of AI, has changed everything. Let’s discuss how.

What is Artificial Intelligence in Healthcare?

AI in medical insurance refers to using advanced algorithms and machine learning to analyse complex medical data. It helps diagnose diseases, personalise treatment plans, and predict patient outcomes. AI can improve efficiency by automating tasks like image analysis, lab reports, and administrative processes. It also assists in drug discovery and clinical decision support. By reducing human error and providing insights from vast data sets, AI aims to enhance patient care, speed up treatment, and make healthcare more accessible and cost-effective.

Role of AI in Health Insurance

• Role of Chatbots

Chatbots are software which is tuned within the website in a manner that can simulate human conversation using text or voice. Earlier, they could only handle repetitive tasks such as answering general policy-related queries. But with their evolution, they now assist customers in selecting suitable plans by analysing their needs, budgets, and coverage preferences. Additionally, chatbots can send reminders for premium payments and offer updates on health insurance policy renewals.

Simply put, chatbots are available 24/7 to ensure quick and efficient support, reducing wait times and improving customer satisfaction.

• Reducing Administrative Costs

In health insurance, from buying a suitable policy to getting claim approval, various steps are involved, many of which are repetitive.

For example, insurance executives can focus on other crucial tasks instead of performing data entry. This helps in effective resource allocation while reducing administrative costs.

• Quick Claim Processing

Gone are the days when you had to wait for days to get your health insurance claim reimbursed. Whether you are filing a reimbursement claim or availing of a cashless facility, upon submission of the necessary details and documents, AI takes care of the rest in the following manner —

• AI-powered systems instantly fetch the data from medical records, prescriptions, and hospital bills. This eliminates the manual effort of reviewing paperwork.

• Next, AI algorithms analyse patterns and flag potential frauds, such as inflated claims or duplicate submissions. This proactive detection speeds up legitimate claims by diverting resources from unnecessary investigations.

• Machine learning models validate policy details, treatment eligibility, and claim coverage in real-time. This ensures claims adhere to policy terms, avoiding delays due to human errors or misinterpretations.

• NLP-enabled systems process unstructured data, like handwritten doctor’s notes or diagnosis reports, transforming it into actionable insights for faster claim adjudication.

• Personalised Coverage

Isn’t it great to make premium payments for health insurance tailored to your requirements and current health conditions? Well, it is possible today.

When you fill out the critical illness insurance form, the insurer requires you to provide details about your lifestyle habits, genetic predispositions, and medical history. Once you share all the necessary information, AI models analyse it and provide a personalised policy featuring customised premiums.

If you use a wearable device, like a fitness tracker, linking it to your insurance can provide more precise coverage. For example, if your smartwatch shows you are active but occasionally experience elevated blood pressure, AI can detect this pattern and suggest a plan with enhanced cardiovascular coverage.

• Speedy Underwriting

Underwriting is when an insurer reviews your proposal request and analyses your current and previous medical records to assess the likelihood of a claim in the near future.

AI-driven tools, such as machine learning models, predict risks with high accuracy.

Let’s say you prefer wearing a CGM (continuous glucose monitoring) device on your forearm. The combined readings from the last 90 days, taken from different devices you wore, show an average postprandial blood sugar level of around 320 mg/dL and a fasting average of 200 mg/dL. Since this data places you in the category of a diabetic patient, the insurer may impose a loading charge due to this pre-existing condition to mitigate the financial risk of claim settlement.

On the other hand, if the CGM readings suggest a normal range and the previous health records show no serious medical history, you can expect lower premiums.

Benefits of Artificial Intelligence in Healthcare

• Clinical Observations

When you visit a doctor, he/she relies on various tools to diagnose/monitor your health.

Suppose you have been complaining of chest pain for the past few weeks, and your doctor recommends undergoing a CT scan or X-ray to identify any abnormalities. Once the report is generated, the AI system compares your scan with a vast database of previous cases and assists your doctor in spotting patterns to make more accurate predictions.

• Early Illness Detection

Medical experts train ML models by collecting, cleaning, and labelling data. The algorithm is then fed this data and learns to identify patterns.

For example, ML models analyse medical imaging data to spot early tumour growth invisible to the human eye in detecting cancer. The more data the model processes, the better it predicts illnesses.

Once trained, these models can assist doctors by providing early alerts to help them intervene before the condition worsens.

• Assisting in Surgery

One of the best examples of this is robotic surgery. During the process, the surgeon guides the robotic arms to perform cutting, stitching, or cauterising, all while viewing the affected area on a high-definition screen.

The system translates the surgeon’s hand movements into smaller, more precise actions to make the procedure successful. Robotic surgery is common in fields like urology, gynaecology, and cardiothoracic surgery.

These surgeries are not only less painful but leave smaller scars than traditional methods.

Impact of AI in Healthcare

• With advanced algorithms, AI helps healthcare professionals make faster and more accurate diagnoses.

• By analysing your medical history and genetic information, AI can predict how your body will respond to different medications or therapies.

• AI streamlines hospital operations by automating administrative tasks such as appointment scheduling, patient record management, and billing.

• AI-powered tools allow continuous monitoring of patients outside of traditional healthcare settings using wearable devices or home health kits. These systems track vital signs, alerting doctors to potential health issues before they escalate.

Conclusion

AI is revolutionising health insurance, making it more efficient, personalised, and accessible. From instant claim processing to tailored coverage and advanced clinical support, AI empowers insurers and policyholders alike. Its transformative potential ensures smoother processes, reduced costs, and better health outcomes, marking a new era in healthcare and insurance.

FAQs

1. What are the benefits of AI for health insurers?

AI offers health insurers several benefits. It improves the efficiency of the resources by automating repetitive tasks, performing risk assessment before policy issuance, and reducing fraudulent claims through pattern recognition.

2. Can AI predict future medical costs for policyholders?

Yes, AI can analyse medical histories, lifestyle data, and other factors to predict potential future medical costs.

3. How does AI improve customer support in health insurance?

AI-powered chatbots provide instant answers to queries, assist in policy purchases, and guide claim submissions, making customer support more efficient.

4. How does AI speed up claims processing?

AI automates the claims verification process, checks policy details, and flags incomplete submissions for faster settlements.

5. How does AI assist in policy renewal?

AI sends timely reminders, suggests policy upgrades, and ensures a hassle-free renewal process.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

Top 6 Healthcare Technology Trends to Watch Out

All You Need to Know About Electronic Health Records (EHR)

The Use of Wearable Technology in Monitoring and Managing Health

Men’s Mental Health: Breaking Stigmas and Barriers

Check Out 6 Smart Gadgets for Those Who are Visually Impaired