AI and the Future of Insurance Premium Auditing

As much of our world has, the insurance industry has recently grown to adapt to technological advancements made in the past decade. Especially under the rise of AI, how insurance premium auditing is determined has started to rely on AI as a tool to streamline the process. In the past, the carrier audited insurance premiums. This estimate was often inaccurate, calculated based on a number of different factors and circumstances, including auditor bias, actual premium basis, proper classifications, and specific rates that may apply to the business. As a result, 25-50% of business owners with insurance policies may have been overcharged during their audit processes. As much as 10-20% of this premium was lost to premium leakage, indicating an urgent need to update the system and adopt new, more efficient practices. Fortunately, in recent years, the world of premium insurance auditing has changed dramatically.

Annual workers compensation premium cost in the United States averaged $55-$60 billion. Insurance premium determination is now handled by an auditor that is contracted by insurance companies. These professionals conduct online audits virtually, through the phone, or even through email. This involves a review of all relevant documents such as payroll information, cash disbursements, tax records, cash receipts, and other certificates of insurance. The auditor then provides a final statement and report upon request, and oversees the receipt of a bill or credit. This process has been greatly aided by the development and evolution of AI, as many of the shortcomings of the previous method have been solved through the use of this software.

The Rise of AI in Insurance Premium Auditing 

New innovations have set in motion a paradigm shift that helps auditors to perform a number of routine tasks at the highest level. AI can easily detect anomalies, predict premium trends, risks, and impact, and can improve evidence-based classification. Artificial intelligence can also uncover real-time operation shifts and can even boost data accuracy and reliability. This technology also fosters more flexible visits and can increase predictive analysis powers. This reduces the likelihood of inaccuracies throughout the process and potentially expensive surprises. Despite the recent integration of AI, these moving parts can make the process seem complex and confusing for many business leaders. Fortunately, with the rise in AI came the proper services to help guide people through the process.

Conclusion

These guiding services will work with businesses of all shapes and sizes across all industries, as they use experienced professionals who can advise on many different topics. Helping businesses save thousands or even millions of dollars throughout the process, these services and the auditors they provide work for the business, not for the insurance company. They are able to take the complexity out of the insurance process, going above and beyond in several areas. From audit management, to documentation support and review, to submission handling and alignment, there is no limit to the support businesses can get when they work through these trained auditors. Especially growing business leaders can get time back to focus on other areas of the business, leaving the auditing process to trusted professionals.