How robo-advisors and chatbots are changing the face of the insurance industry

Artificial intelligence is playing an increasingly active role in the financial services industry, from risk analysis and mitigation to regulatory compliance and client interaction – machine learning is proving its worth. Globally, insurance providers are getting in on this trend, and South African insurance companies are not far behind.


This is according to Vera Nagtegaal, the executive head of, who says that humans are getting used to talking to computers. “Global tech giants like Amazon and Google have rolled out digital assistants (Alexa and Hey, Google), and Apple’s product HomePod will be out later this year. But before people hand over the running of their households to artificial intelligence (AI), they will probably have the opportunity to interact with a machine’s “mind” much sooner – in the form of an insurance robo-advisor or chatbot.”


Globally, the trend has already taken off. At this year’s CES (originally called the Consumer Electronics Show), AI was all the rage, and many commentators said that its deployment in the insurance industry is set to change the way the business operates, forever.


In PWC’s Global Fintech Report 2017, it was highlighted that insurance companies have been accelerating efforts to keep pace with trends reshaping the market and closing the gap with other financial sectors. “In fact, 52% of insurers continue to see their industry as the second most likely sector for disruption, only after consumer banking,” the report stated.


Because of this, Nagtegaal says that these companies are increasing engagements and partnerships with FinTech businesses, to create solutions like chatbots on the consumer-facing side, and machine learning to assess risks and develop products internally.


She explains that US-based insurer Lemonade, for instance, uses two different AIs to interact with its customers. “One is called Maya, who signs users up by asking them a series of questions on their smartphones. The other is Jim, who handles claims, which he can process entirely without human intervention.”


“The number one reason for deploying a chatbot in the insurance industry is time availability,” says Nagtegaal. “So much of insurance is about answering frequently asked questions and then crunching the numbers relating to a specific query or claim. Since this can be done effectively and efficiently by AI without causing dissatisfaction to the customer – and in many cases, actually boosting satisfaction – this is a solution that many global companies are looking into.”


According to a survey by AXA, 34% of millennials want to interact with their insurer online only – showing that the market is ripe for robo-advisor interaction.


“So it’s not simply a case of insurance companies rolling out new technology for its own sake. AI-interaction is something that customers really want and even prefer,” points out Nagtegaal.


This is why, closer to home, South Africa’s is blazing a trail with its Siah (acronym for ‘service in a hurry’) chatbot, a text-based AI interface that will ask the right questions, request information and then provide customers with comparative quotes – without a human agent needing to intervene.


Nagtegaal says that Siah has been developed to respond intelligently to customer queries and to prompt the customer with the right questions to be able to deliver a range of comparative quotes. “She hasn’t just started out intelligent – she’ll be learning along the way, getting better and better at helping our customers out. So, the more queries Siah receives the more things she will be able to answer.”


Nagtegaal adds that the next phase will be to integrate Siah with’s Facebook Messenger and WhatsApp platforms.


While artificial intelligence in the insurance space is still in its infancy, this is one of the industries that has been earmarked for disruption. It is likely that the market will be seeing more and more customers interacting with chatbots without giving it a second thought in the years to come.

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