How Artificial Intelligence, Data Analytics Reshaping The Future Of Business In Africa
BY EDET UDOH
Globally, technological advancements are reshaping the business landscape with digital technologies such as Artificial Intelligence (AI), and Data Analytics (DA) disrupting traditional models of operations and creating new opportunities for innovation aligned to customer needs and expectations.
In Africa, business operators such as insurers, bankers, media houses, manufacturers, healthcare, telecommunication, retail etc that leverage these technologies are streamlining their operations, improving risk assessments, claims- fraud detection; actuarial services – right pricing, personalized customer engagement and most importantly, developing innovative products that meet the evolving needs of their consumers as well as enjoying enhanced business effectiveness and efficiency.
This focus on agility, innovation, and customer satisfaction is helping the industry navigate complexities and meet new customers’ demands and expectations.
Customer satisfaction is especially crucial as businesses continue to evolve and grow across markets therefore adoption of technology such as AI and data analytics is essential.
Information and Communication Technology (ICT) experts, insurance professionals, and regulators have spoken at different forums on how AI is reshaping the future of businesses; emphasizing the need for operators to adopt it in their operations to take advantage it provides to deepen the sector’s growth.
This article speaks more on the adoption of artificial intelligence and data analytics in insurance sector.
History of AI:
According to aws.amazon.com, in his 1950 paper, “Computing Machinery and Intelligence,” Alan Turing considered whether machines could think. In this paper, Turing first coined the term artificial intelligence and presented it as a theoretical and philosophical concept. However, AI, as we know it today, is the result of the collective effort of many scientists and engineers over several decades.
1940-1980:
“In 1943, Warren McCulloch and Walter Pitts proposed a model of artificial neurons, laying the foundation for neural networks, the core technology within AI.
“Quickly following, in 1950, Alan Turing published “Computing Machinery and Intelligence,” introducing the concept of the Turing Test to assess machine intelligence.
“This lead to graduate students Marvin Minsky and Dean Edmonds building the first neural net machine known as the SNARC, Frank Rosenblatt developed the Perceptron which is one of the earliest models of a neural network, and Joseph Weizenbaum created ELIZA, one of the first chatbots to simulate a Rogerian psychotherapist between 1951 and 1969.
“From 1969 until 1979 Marvin Minsky demonstrated the limitations of neural networks, which caused a temporary decline in neural network research. The first “AI winter” occurred due to reduced funding and hardware and computing limitations. (awa.Amazon.com).
According to experts, technology refers to the tools, systems, or methods developed to solve problems or make tasks easier. On the other hand, artificial, as the name implies, is a system created by humans to look/behave like humans. Intelligence is only reserved for humans. It is derived from knowledge. AI, therefore, is the system created by humans to behave intelligently like humans based on data.
AI In Business Operations:
Overview of Artificial Intelligence and Technologies relevant to business operations include Machine Learning (ML): Algorithms that enable systems to learn from data and improve over time without explicit programming. ML is used for tasks such as fraud detection, customer segmentation, and predictive analytics.
Natural Language Processing (NLP) – This technology allows computers to understand, interpret, and respond to human language. NLP is used for automating customer service through chatbots, processing large volumes of text data, and extracting insights from unstructured data.
Robotic Process Automation (RPA) – RPA involves using software robots to automate repetitive and rule-based tasks. This streamlines processes such as data entry, document processing, and compliance reporting.
Computer Vision – This technology enables computers to interpret and make decisions based on visual inputs. It is used for tasks such as document verification, identity verification, and monitoring physical assets.
Generative Artificial Intelligence (GenAI) Vs Artificial Intelligence (AI):
AI is the umbrella term for all intelligent systems, focusing on tasks like analysis, predictions, and automation. Gen AI is a branch of AI specialized in generating original and creative outputs.
Understanding Gen AI:
Artificial Intelligence (AI) refers to the development of computer systems to perform tasks that need human intelligence.
Machine Learning (ML) is a subset of AI that enables computers to learn from experience.
Deep Learning (DL) is a subset of Machine Learning that uses natural networks for data processing.
Generative AI is a subset of DL that generates content like text, images, or codes based on input.
AI and Data Analytics In Media Houses:
Speaking on the topic “AI In Journalism: Where Is The Media Headed & What Becomes of Journalists? at the public presentation of the Business Journal Newspaper on September 16, 2022, in Lagos, Mr Tim Akano, Managing Director/Chief Executive Officer, New Horizons Limited, emphasized the need for the media practitioners to take advantage of the opportunities offered by Artificial Intelligence (AI) to remain relevant even as he called for the immediate establishment of www.Journalism AI.ng to make the benefits of AI more accessible and counter inequalities in the global news media space.
Artificial intelligence (AI), according to him, is the simulation or hacking of human intelligence processes by Machines, especially computer systems, noting that as of 2020, over 40% of the top 70 news organizations worldwide used AI in the media.
Mr. Akano said “Artificial Intelligence is the biggest disruptor of the creation, production, distribution, consumption, and archiving of news products and services.
The functions of AI, according to Akano, include monitoring, discovering, predicting, interpreting and interactions while the benefits amongst others include improvement of the quality of engagement and programming based on customer interest, trends, and scenarios; Machine Learning recommends personalized content based on user data on preferences. Matchmaking the right content with the right audience; Cognitive AI helps increase customer engagement and satisfaction; AI applied to video content helps to conduct visual analysis that tracks & captures emotions instantly and facilitates content; AI facilitates accuracy, speed, and efficiency Real-time analytics determine the ideal advertisements for the audience.
AI and Data Analytics In Finance/Securities & Exchanges:
At a recent webinar by Coronation Registrars Limited titled “Navigating the Nexus: Maximizing Value with Securities Registrar and Data Management Services in a Digital Age,” Dr Orlando Olumide Odejide, in his Keynote Address, highlighted how AI and data analysis enhance business effectiveness and efficiency, emphasizing the need for Coronation Registrars to key into this to improve services to both its internal and external stakeholders.
Examples of Successful Data Analytics Implementation in other sectors such as Retail, Healthcare, Banks, Manufacturing, and Telecommunication:
Retail Sector – Companies like Amazon and Walmart use AI and Data Analytics to optimize supply chain management, personalize customer recommendations, and enhance inventory management. For instance, Amazon’s recommendation engine analyses customer behaviour to suggest products, leading to increased sales.
Healthcare – Hospitals and healthcare providers use Data Analytics and AI to predict patient admissions, optimise treatment plans, and improve patient outcomes. For example, predictive analytics helps in identifying patients at risk of readmission, allowing for proactive interventions.
Finance – Banks and financial institutions leverage AI and Data Analytics for fraud detection, risk management, and personalised financial services. For instance, machine learning algorithms detect unusual transaction patterns indicative of fraud, enabling swift action.
Manufacturing – AI and Data Analytics helps manufacturers optimise production processes, reduce downtime, and improve quality control.
For example, predictive maintenance uses data from machinery to predict failures before they occur, reducing downtime and maintenance costs.
Telecommunications: Telecom companies use AI and Data Analytics to enhance network performance, improve customer service, and develop targeted marketing campaigns. For instance, analysing call data records help identify network issues and improve service quality.
The Role of Data Analytics:
Data analytics involves the systematic computational analysis of data. It is used to discover patterns, correlations, and trends within large datasets. Techniques include statistical analysis, machine learning, and data visualisation, which help transform raw data into meaningful insights.
Significance of Data Analytics:
Enhanced Decision-Making: Data analytics provides a factual basis for decision-making by uncovering trends and patterns that might not be immediately apparent. This leads to more accurate forecasting, better risk management, and strategic planning.
Operational Efficiency: By identifying inefficiencies and areas for improvement, data analytics help streamline operations, reduce costs, and optimise resource allocation. This can lead to significant improvements in productivity and profitability.
Customer Insights: Analysing customer data allows businesses to understand behaviour, preferences, and needs. This enables the creation of personalised experiences, targeted marketing campaigns, and improved customer service, leading to higher satisfaction and loyalty.
Competitive Advantage: Companies that leverage data analytics stay ahead of market trends, respond quickly to changes, and innovate continuously. This provides a significant edge over competitors who do not utilise data-driven strategies.
How Data Analytics Improve Decision-Making:
Predictive Analytics – By using historical data, predictive models forecast future events, helping businesses to prepare and strategize accordingly. For example, predicting customer demand helps manage inventory more effectively.
Real-Time Analytics – Real-time data analysis allows businesses to make immediate decisions based on current information. This is particularly useful in dynamic environments where conditions change rapidly.
Descriptive Analytics – This involves analysing past data to understand what happened and why. It helps in identifying patterns and trends that can inform future strategies.
Prescriptive Analytics – This goes a step further by recommending actions based on the analysis. It uses algorithms and machine learning to suggest the best course of action for achieving desired outcomes.
Benefits of Artificial Intelligence:
Automation – Efficiency: AI automates routine and repetitive tasks, freeing up human resources for more strategic activities. For example, Robotic Process Automation handles data entry and document processing, reducing the time and effort required for these tasks.
Consistency – Automated processes ensure consistent and error-free execution, which is crucial for maintaining data integrity and compliance.
Accuracy – Data Processing: AI algorithms process large volumes of data with high accuracy, reducing the likelihood of human errors. This is particularly important for tasks such as data analysis, reporting, and compliance checks.
Decision Making – AI provides data-driven insights and recommendations, enhancing the accuracy of decision-making processes. For instance, Machine Learning models predict fraudulent activities with high precision.
Predictive Analytics – Forecasting: AI analyses historical data to predict future trends and outcomes. This helps businesses anticipate customer needs, optimise resource allocation, and improve service delivery.
Risk Management – Predictive analytics identify potential risks and provide early warnings, enabling proactive measures to mitigate these risks. For example, AI predicts which customers are likely to be fraudulent, allowing for timely intervention.
Emerging Trends in Data Analytics and AI:
This includes Big Data and Advanced Analytics as well as Blockchain Technology.
Real-Time Analytics: Implementing systems that provide real-time insights, allowing for immediate action and response.
Data Visualisation: Utilising advanced visualisation tools to present complex data in an easily understandable format, aiding in better decision-making.
Blockchain Technology:
Data Security and Integrity: Ensuring the security and integrity of data through decentralised and tamper-proof blockchain systems.
Transparent Transactions: Enhancing transparency and trust in transactions and record-keeping.
Use Cases for Data Analytics and AI:
These are Customer Segmentation and Behaviour analysis. Customer Segmentation – In this case, businesses utilise data analytics to segment their client base into distinct groups based on demographics, transaction history, and engagement levels. This segmentation allows for a deeper understanding of each group’s unique needs and preferences, enabling more targeted and effective service delivery.
Behavioural Analysis – By analysing patterns in client interactions, such as frequency of contact, types of inquiries, and service usage, business operators gain valuable insights into client behaviour. This information are used to anticipate client needs, address common pain points, and enhance overall service quality.
Critical Role of AI in Reshaping African Insurance Landscape:
In a recent virtual programme – themed “Digital Transformation in Africa Insurance Market,” Funmi Omo, Chief Executive Officer of Enterprise Life Nigeria, highlighted the critical role of digital technologies in reshaping the insurance landscape in West Africa.
Omo explained how digital platforms, artificial intelligence (AI), machine learning (ML), the Internet of Things (IoT), data analytics, and blockchain technology are disrupting traditional insurance models.
Addressing the specific needs of the African market, she underscored the importance of developing user-friendly insurance apps optimised for low-bandwidth connections and offline capabilities, offering flexible payment options, and providing 24/7 customer support.
In the same vein, Mr. Johnson Chukwu, in his presentation at BusinessToday conference 2024, titled “The World Of AI: How Insurance And Pension Sectors Can Explore Opportunities For Market Penetration,” noted that, with technology, the negative perception that most people have about insurance and claims payments will be wiped out as it makes insurance policy subscription and claims payments seamless and faster.
According to Chukwu, the insurance industry in Nigeria and Africa as a whole will benefit greatly by adopting AI as it will improve their customers’ experience, engender confidence and trust, improve service quality and reduce costs, adding that, AI holds the promise of transforming the traditional insurance landscape by addressing critical challenges, disrupting existing norms, and optimising risk management processes.
He said the adoption of AI would enhance service efficiency, stressing that, a decrease in the cycle would lead to faster execution, improved accuracy; detailed data capture flexibility & scalability, and ensure improved productivity.
“With AI, you can settle claims within some hours or days on motor insurance. No doubt, AI will help in improving claims settlement. AI can harvest records of the insured in terms of making claims, which will enhance accurate pricing of policy,” he said.
For Customer Service, he pointed out that, AI tools such as chatbots, a virtual assistant, help to improve customer experience, saying, Chatbots are available 24/7 to give basic advice, check billing information, and address common inquiries and transactions, as it is deployed to recapture customers’ data more effectively, even as it effectively analyse investment portfolios and recommend necessary actions such as sell, buy, hold, among others.
Advancement in AI, he noted, is underpinned by the drive for convenience and efficiency, which are the two most important competitive tools in the business world, stating that, businesses and industries that want to remain relevant in the economic ecosystem will therefore need to embrace AI as an integral part of their business.
Speaking on the topic: “Shaping Insurance Industry’s Future: AI, The Way To Go,” at the just concluded 2024 West African Insurance Companies Association (WAICA) Education Conference in Accra, Ghana, Mr Ofori-Atta, who is also the IT Manager at KEK Insurance Brokers, Ghana, listed how AI is shaping Insurance business in West Africa and what business are expected to do: Data Accuracy; AI Goals and Use Cases; Capability Assessment; Governance and Review; Technology and Integration; Skills and Team Readiness; Risk Management and Communication.
“Data Accuracy: Organizations must ensure accurate and reliable data before building AI models to avoid reputational and regulatory risks.
“AI Goals and Use Cases: Leadership should define AI goals and prioritise use cases to generate short-term returns and build momentum.
“Capability Assessment: Begin with a clear understanding of current capabilities across key pillars of AI maturity, supported by robust governance structures.
“Governance and Review: Establish governance with review mechanisms to monitor output reliability, flag concerns, and ensure adherence to agreed guidelines.
“Technology and Integration: Ensure technology and systems integrate AI into current processes effectively, achieving optimal outcomes.
“Skills and Team Readiness: Verify the availability of skilled personnel before embarking on AI initiatives.
“Risk Management: Implement structured testing and validation processes to assess AI results, manage biases, and address any issues.
“Communication: Develop a communication strategy for stakeholders and the wider business to clarify AI’s role and future implications for roles,” he explained.
On the adoption of AI and automation in the sector, quoting KPMG’s Global Tech Report, KPMG International, September 2024, 165 Insurance respondents, Mr. Ofori-Atta said, “34 per cent leadership supports and has funded the AI adoption strategy, yet implementation is behind schedule.
“23 per cent strategic vision exists but executive buy-in and/or investment approval limits progress.
“30 per cent are proactive in progressing against the strategy and are continually evolving.
“13 per cent of the strategy is being designed and pilot tested, but a broad initiative has not yet started.”
“57 per cent of organisations see AI as the most important technology for achieving their ambitions over the next three years.
“58 per cent of insurance CEOs interviewed said it will take three to five years for Gen AI to provide a return on investment.
“85 per cent of insurance CEOs believe that Gen AI is a double-edged sword, in that it may not only aid in the detection of cyber attacks but also provide new attack strategies for adversaries.
“61 per cent of organisations are wary about trusting AI systems, with 84 per cent citing cybersecurity as a top concern. (KPMG International – Advancing AI Across Insurance: Unlocking Transformation With Speed And Agility).
Sector Head of Heirs Insurance Group, Niyi Onifade, has called for the adoption of Artificial Intelligence (AI) to revolutionise insurance in West Africa.
Onifade while delivering the keynote address and theme paper, “Artificial Intelligence and the Future of Insurance in West Africa,” at the West African Insurance Companies Association (WAICA) Conference in Accra, Ghana, on November 18, 2024, highlighted the critical role Artificial Intelligence (AI) plays in shaping the future of the insurance sector in West Africa.
Onifade, in his presentation, emphasised the need for insurance companies to embrace AI to stay competitive and meet the demands of modern consumers.
He outlined how AI is revolutionising the insurance experience by automating processes such as claims management, enhancing risk assessments, and providing personalised customer service.
A computer expert and a Non-Executive Director at Digital Transformation Strategy Delivery, Ghana, Mr. Ebo Richardson, in his presentation titled “Development of AI Across Insurance Value Chain,” at the 2024 West African Insurance Companies Association (WAICA) Education Conference at Accra, Ghana, highlighted various ways that AI is being used across businesses especially insurance value chain to accelerate growth in West Africa.
Ebo affirmed that AI is already extensively used in various areas namely: Digital Assistants, Search engines, Social media, Online shopping, Robots, Transportation and navigation, Text editing and autocorrect, Fraud prevention, Predictions, Gaming, Healthcare, Advertising and Analytics.
On what AI brings to the party, according to Mr. Richardson, includes Data analysis, manipulation and reporting; efficiency and huge data processing capacity; cost and operational efficiency; enhanced problem-solving capability and automation, Robotics and generative AI.
On Insurance and AI Synergies/Uses, the Computer Expert said: “It enhances the delivery of efficient customer support; helps in claim fraud detection and prevention; helps in insurance pricing and underwriting; enhances accelerated claims processing; supports claims reserve optimisation; helps in personalised recommendations and ensures prediction of customer churn.
AI adoption in insurance businesses, Ebo explained “undertake limited pilots/proof of concepts (PoCs)- to enable safe/controlled entry into the space and allow useful learning that will help shape policy and strategy; align policies and strategies accordingly – using appropriate guidance and learning from PoCs etc, develop the required transformational strategies and policies etc.
“Get help if needed – Source support from experts, if and where needed; also develop/source AI-related talent to work internally.
“Perform Architectural reset – Based on policies and strategies, review key elements of the Company’s Architecture to ensure readiness.
“Prioritise and execute solutions – Initiate AI-related projects, prioritising customer-centric ones, and some low-hanging fruits as well as automate rule-based processes.”
Adoption of AI in the insurance sector in some African countries including Nigeria, South Africa, Egypt, Algeria, Kenya, and Ghana
AI Adoption in Nigeria:
Speaking at a recent industry event in Lagos the immediate past Commissioner for Insurance/CEO, National Insurance Commission (NAICOM), Mr. Sunday Olorundare Thomas, noted the importance of the adoption of artificial intelligence (AI) saying it is key to the future of insurance business in Nigeria.
Thomas who was represented at the event by the Deputy Director, Lagos Office of NAICOM, Ajibola Olabisi Bankole, urged insurance operators to increase adoption in this area as it gives better productivity and enhances profitability while ensuring quick service delivery and claims payment to insurance consumers.
Technology adoption, he said, is part of the 10-year roadmap of the insurance industry, stating that, NAICOM, as a regulator, will continue to evolve policies that will engender the growth of the industry, increase penetration and contribution to the nation’s GDP.
Although insurance players in Nigeria are working assiduously to ensure the adoption of AI, many said the level of adoption of this technology in Nigeria is still at its formative stage.
In an interview with this medium, the President/Chairman of Council, Chartered Insurance Institute of Nigeria (CIIN), a training arm of the insurance industry in Nigeria, Mr. Edwin Igbiti, while assessing the level of adoption of AI in the Nigerian insurance industry, scored the industry low.
“I would assess the level of adoption of Artificial Intelligence (AI) by insurers in Nigeria as being in its early stage, with a few pioneers exploring its potential.
While there is growing recognition of AI’s transformative power, many insurers are still in the process of understanding its applications and benefits.
“On a scale of 1-5, with 1 being “limited awareness” and 5 being “advanced adoption,” I would rate the current level of AI adoption in Nigeria’s insurance industry as a 2, “exploration and experimentation.” Some insurers are starting to explore AI-powered solutions, but widespread adoption and implementation are still limited.
“However, there is a growing interest in AI-powered solutions, and some insurers are starting to explore its applications in areas like automated underwriting, claims processing, and customer service. As the industry continues to evolve, I expect to see more insurers embracing AI to enhance their operations, products, and customer experience.
On how AI revolutionises customer experience and deepens growth, he said “I would say that AI is revolutionising customer experience in the Nigerian insurance industry through enhancement of personalized services and tailored policy offerings, streamlining claims processing and reducing settlement times which is of great help to the Insurance branding image, providing 24/7 customer support and engagement through chatbots and virtual assistants, offering real-time policy management and self-service capabilities, enabling data-driven underwriting and risk assessment and improving fraud detection and prevention in general.
Speaking further on the level of adoption of AI in Nigeria, CIIN boss said, “In the next ten years, I envision more insurance companies in Nigeria embracing AI and technology to become more efficient, customer-centric, and innovative.
“Insurers are leveraging AI for things like; data-driven decision-making and product development, enhanced risk assessment and underwriting, automated claims processing and settlement, personalized marketing and customer engagement, improved regulatory compliance and risk management and increased adoption of digital channels and self-service platforms to mention a few.
AI Adoption in South Africa:
In South African, according to Mishaya Chettiar, Executive Head at Everything Insure, in her article “How InsurTech is disrupting SA’s Insurance Industry by putting the customer first,” using technologies such as AI, machine learning, and data analysis.
Insurtech is enabling the creation of insurance products with intelligent underwriting that are more competitively priced through adaptable and tailored solutions, empowering consumers with the ability to make changes to their insurance plans or submit a claim anywhere at any time, and facilitating the ability to stop and start their insurance plan based on when they need it and when they don’t, with just a simple click of a button.
Prior to the adoption of these technologies in the industry, there was no way to tailor products to individual customers or to tailor underwriting rules.
“These technologies have enabled greater efficiencies for customers in regard to timely claims processes, risk evaluations, and the processing of policies. And, with AI, insurance systems can automatically make changes or suggest new offers to a customer’s profile based on changes to their risk profile or shifts in the insurance industry.
“Until now, insurance was a complex and confusing subject to tackle for consumers who knew very little about the industry. But, Insurtech is empowering customers with a greater level of information at their fingertips before they make a purchasing decision by enabling consumers to compare the products, services, and features of different insurers and find the one that fits just right for their unique wants and needs.
“Essentially, Insurtech is giving South African consumers greater agency in their insurance decisions and is leading to improved outcomes in the way that the market operates – in favour of the consumer over the industry.
“When a business integrates customer centricity into its business strategy, the organisation can change the way that it thinks about and communicates with its customers on all levels. This results in more authentic customer experiences and significant cost savings for consumers.
“And, just like the FinTech revolution brought on a new wave of innovation within the financial services industry, Insurtech is primed and ready to reshape and redefine what insurance looks like and what it means for consumers not only in South Africa but across the African continent and the rest of the world. Now, just like they’re able to with every other area of their lives, consumers will be able to take greater ownership of their insurance portfolio,” she stated.
AI Adoption in Egypt:
According to analysts the adoption of artificial intelligence (AI) by Egyptian insurance companies is an area of growing interest as it has revolutionised various aspects of insurance operations, including underwriting, claims processing, customer service, fraud detection, and risk management.
However, successful adoption depends on change management practices and data readiness. Insurance companies should focus on building internal tools to foster a productive culture of AI adoption and enhance efficiencies.
The Egyptian government’s initiatives to modernise healthcare infrastructure, including digitizing health records, also provide a strong foundation for integrating AI technologies.
Certainly, here are some innovative Egyptian insurance companies that have leveraged technology, including AI, to enhance their services and positively impact lives, some of which include Hood, Mazboot and MerQ.
Hood collects data related to car mileage, gas usage, performance, and engine health. By analyzing this data, it helps drivers save time and money, and avoid accidents by promoting better driving habits.
Mazboot is an application designed for people living with diabetes. It assists them in self-managing their condition and provides consultations with doctors.
These companies demonstrate how technology adoption can lead to better customer experiences and operational efficiency in the insurance sector. While specific AI success stories may not be widely documented, the industry is gradually embracing technological advancements to meet evolving needs.
Adoption of AI In Algeria
The insurance industry in Algeria has taken a significant step into the technology era with the launch of Hayat, the first artificial intelligence (AI)-based insurance chatbot by the life insurer Macir Vie. This move reflects the growing interest in AI adoption within the industry. While the adoption of AI in Algeria is still in its early stages, there’s potential for further growth and transformation.
Here are some ways AI can impact the insurance sector – Fraud Detection: AI algorithms can be trained to detect patterns of fraud in insurance claims, helping companies identify fraudulent activities before they result in significant financial losses.
Personalization for Customers: By leveraging customer data, insurers can use AI to develop personalized products and services that better meet individual customer needs.
Faster Claims Processing: AI can automate routine customer inquiries and claims processing, allowing insurers to provide more efficient and faster service to their customers.
Legacy System Solutions: AI can extract logic and data from legacy systems while API-enabling them to feed into AI solutions.
Learning and Development (L&D): AI can play a role in constant reskilling, making learners more agile and responsive to industry and organizational changes.
Successful AI adoption depends on change management practices and data readiness. Insurance companies should focus on building internal tools to foster a productive culture of AI adoption and enhance efficiencies. Ensuring proper data management frameworks are in place can provide compliance, improved decision-making capabilities, and better insights2. While Algeria’s insurance industry is just beginning to explore AI, it holds promise for future advancements and improved processes.
Hayat is a groundbreaking initiative by the Algerian life insurer Macir Vie. It marks the introduction of conversational artificial intelligence (AI) in the Algerian insurance landscape. Here are the key details:
Purpose: Hayat serves as an AI-driven chatbot designed to assist customers. It’s accessible to the public via Macir Vie’s website at www.macirvie.com.
Functionality: As an AI chatbot, Hayat engages in natural language conversations with users. Customers can interact with it to get information, ask questions, and receive personalized assistance related to insurance products, policies, claims, and other relevant topics.
AI Adoption in Kenya:
“In Kenya, The ability of artificial intelligence (AI) to process vast amounts of data with unprecedented speed and accuracy is transforming the insurance industry. Through machine learning algorithms, underwriters now analyse historical data, detect patterns, and predict future risks for any product with greater precision.
“This newfound insight is fast revolutionizing underwriting practices, enabling insurers to offer more personalized coverage options tailored to individual customers’ unique needs and circumstances,” David Muiruri, General Manager, Digital ICT Projects & Network Infrastructure at Minet Kenya, said in his article “How Artificial Intelligence Will Revolutionize Kenya’s Insurance Industry.”
According the article, “The ability of artificial intelligence (AI) to process vast amounts of data with unprecedented speed and accuracy is transforming the insurance industry in Kenya.
“Traditionally, Kenya’s insurance industry has thrived on providing cover for conventional risks such as medical, motor, fire, travel, property, and personal accident covers. Say, for motor insurance, pricing is only based on the type and age of the vehicle to be insured without regard to the driving habits or identity of the motorist involved.
“Even when an accident occurs, insurance companies rely on police abstracts and a risk assessor’s report with no hindsight on verification of when the accident occurred, who was driving the vehicle, and when and where the accident occurred.
“As the Kenyan insurance industry looks toward the future, it stands at the cusp of a groundbreaking revolution driven by AI that has the potential to transform every facet of the insurance ecosystem unlocking unparalleled opportunities for growth, accessibility, and efficiency.
“One of the most transformative impacts of AI in the Kenyan insurance landscape lies in its potential to streamline and enhance the underwriting process. Traditionally, underwriting has been a time-consuming and resource-intensive endeavour, hindering the development of innovative and tailored insurance products.
“According to the 2019 report by Genpact, 87 per cent of insurance brands are now investing over $5 million in Artificial Intelligence related technologies each year.
“With AI’s ability to analyse vast amounts of data from diverse sources, insurers can now make data-driven decisions in real time. This enables them to develop personalized insurance offerings that cater to the unique needs and risks faced by Kenyan policyholders. This could see premiums drop, thereby increasing insurance penetration across the country.
“For many years, Kenyan underwriters have faced the daunting challenge of fraudulent claims, especially in motor-related insurance products which have resulted in substantial financial losses, ultimately eating into premiums paid by honest policyholders. AI’s implementation can be a game-changer in this regard, as it can identify patterns and anomalies indicative of fraudulent activities.
“By detecting and preventing fraudulent claims, AI will create a more reliable and trustworthy insurance environment, benefiting both insurers and honest policyholders.
“Customer experience is another area witnessing remarkable transformation through AI adoption. Chatbots and virtual assistants powered by AI are revolutionizing customer service by providing 24/7support, addressing queries instantly, and guiding customers through the insurance process seamlessly.
Adoption of AI in Ghana:
According to myjoyonline.com, Ghana stands at a pivotal point in its economic history. The country has made significant strides in agriculture, mining, and manufacturing. Yet, like many developing nations, it faces obstacles such as high youth unemployment, infrastructural deficiencies, and an over-reliance on raw material exports. To break free from these constraints and usher in a new era of prosperity, Ghana is looking to Artificial Intelligence (AI) as a powerful tool to supercharge its industrialisation efforts.
AI is no longer a futuristic technology reserved for Silicon Valley. From small-scale farmers predicting rainfall patterns to doctors diagnosing diseases in remote areas, AI is already making a difference. But for Ghana to fully realize the transformative potential of AI, the country must overcome various challenges—including infrastructural gaps, data accessibility issues, and skills shortages.
The Ghanaian government has introduced AI in all the sectors of the nation’s economy including agriculture, healthcare, education, manufacturing, finance, transportation, telecommunication, tourism, environmental management etc.
AI holds immense potential for transforming Ghana’s economy and improving the lives of its citizens. From agriculture to healthcare, finance to manufacturing, AI can drive productivity, foster innovation, and create new job opportunities. However, to harness this potential, Ghana must address the challenges of infrastructure, data access, and skills development.
Challenges in artificial intelligence implementation:
According to aws.Amazon.com, several challenges complicate AI implementation and usage. The following roadblocks are some of the most common challenges. They include AI governance, Responsible AI, Data limitations, and Technical difficulties.
AI governance: Data Governance policies, according to awa.amazon.com, must abide by regulatory restrictions and privacy laws. To implement AI, you must manage data quality, privacy, and security. You are accountable for customer data and privacy protection. To manage data security, your organization should understand how AI models use and interact with customer data across each layer.
Responsible AI: Responsible AI is AI development that considers the social and environmental impact of the AI system at scale. As with any new technology, artificial intelligence systems have a transformative effect on users, society, and the environment. Responsible AI requires enhancing the positive impact and prioritizing fairness and transparency regarding how AI is developed and used. It ensures that AI innovations and data-driven decisions avoid infringing on civil liberties and human rights. Organizations find building responsible AI challenging while remaining competitive in the rapidly advancing AI space.
Data limitations: You need to input vast volumes of data to train unbiased AI systems. You must have sufficient storage capacity to handle and process the training data. Equally, you must have effective management and data quality processes in place to ensure the accuracy of the data you use for training.
Technical difficulties: Training AI with machine learning consumes vast resources. A high threshold of processing power is essential for deep learning technologies to function. You must have robust computational infrastructure to run AI applications and train your models. Processing power can be costly and limit your AI systems’ scalability.
Need To Acquire Adequate AI Skills:
For businesses to remain competitively relevant in the face of unfolding technological advancements, there need need for business managers and workers to acquire adequate technology skills that will make them effective and efficient in their professional fields.
Speaking at the 2021 Insurance Directors’ Conference in Lagos with the theme “Insurance Industry in a Changing World,” the President/Chairman of Council, Chartered Insurance Institute of Nigeria (CIIN), Sir Muftau Oyegunle, identified the importance of Artificial Intelligence (AI) to every business firm in the 21st-century industry even as he emphasized the need for business operators to acquire necessary AI skill to remain relevant in the evolving business landscape.
Sir Oyegunle called on the insurance stakeholders to be at the cutting edge of technology and to equip themselves with appropriate tools required for performance.
According to him, it is impossible to talk about the changing world of insurance or even the financial sector in general, without talking about Artificial Intelligence (AI).
“AI is fast becoming the order of the day as organizations seek to build leaner but more effective teams. Every business firm in the 21st Industry must leverage on technology to simplify its business strategies and processes especially now that the pandemic has forced business executives to do things differently.
“The future that AI promises for insurance is a series of touchless processes from premium collection through the entire value chain until claims processing. This is evident by the numerous startups, as well as IT and insurance giants massively investing and offering increasingly innovative new solutions. It is imperative for market stakeholders to be at the cutting edge of technology and to equip themselves with the appropriate tools required for performance. The purpose of insurance is to enable risk-taking, support economic growth, encourage innovation and ultimately to enhance the resilience of the society and economy,” he stated.
CIIN boss said there is a need for “us as individuals, professionals, and organizations to aggressively equip ourselves with skills and knowledge to ensure we have the best assets. This implies that we must groom world-class manpower for improved performance and growth of the industry. With the increasing digitalization and ‘low touch’ system where human input is minimal, professionals must meet the emerging demands for specialized skills.”
In today’s evolving business world driven by technology, the adoption of AI and DA has transformed the way business is being conducted globally, enhancing effectiveness and efficiency; therefore, to remain effectively competitive and efficient, there is need for organisations yet to integrate AI and DA capabilities into their operations to do so to optimize business processes, improve customer experiences, cut costs, streamline downtime, enhance productivity and accelerate innovation and growth and improve profitability.
