The insurance industry was one of the earliest adopters of AI. With plentiful data, experience in analytic decision making, and underwriting losses putting pressure on margins, insurers were some of the most enthusiastic adopters of AI pilots – but only 7% of them bring these efforts to scale. While many claims organizations have experimented with AI, few have brought these experiments to real impact. And part of the reason for this is AI fatigue.
The past two years have seen a major shift around AI in claims. With 77% of insurance professionals and 70% of legal professionals now using AI in their workflows, McKinsey suggests that automation (and AI) could soon be responsible for as much as half as claims.
Is the industry ready? Despite the enthusiasm, many insurance professionals are expressing fatigue – even as AI tools speed up the pace. So what is the industry’s solution?
What is AI Fatigue?
AI fatigue is a multidimensional problem that exists at the intersection of technology stress, cognitive overload, and the pace (and unevenness) of innovation. Enterprise organizations face tool overload, managing multiple platforms that are not always integrated with legacy workflows, meaning fragmented processes and exhausted teams. Plus, organizations are always being asked to pick up the pace – unrealistic expectations around quick ROI can exacerbate AI fatigue, as well as constant updates around new products.
The History of AI in Claims
As claims providers adapted to greater complexity, distributed operations, adjuster burnout, and a higher stakes claims environment, technology adapted as well. Over the course of time, claims processing software adapted to meet processing needs.
- Pre-1990s: Before the 1990s, claims processing was manual. In-house administrative staff reviewed paper documents by hand, with bottlenecks due to processing time.
- 1990s: Offshore BPOs began to fill in the gaps for claims teams and labor intensive, paperwork heavy processes.
- 2000s: New digital processes, scanning tools, and digitization tech (like OCR) helps speed up the process of scanning and processing claims documents, and helps move paper files to digital.
- 2010s: Claims processing software begins rules-based automation and document workflow tools, simplifying and summarizing newly digital workflows.
- 2020s: The first wave of AI-assisted claims processing automation hits the market, promising fully automated and accurate claims with expert in the loop oversight.
The History of AI Fatigue
No single Intelligent Document Processing (IDP) solution is designed to process every type of document and its contents – but in the world of insurance claims, optimization is non-negotiable. Adjusters, legal teams, and IMEs rely on handwritten notes, medical files, provider correspondence, and legal filings.
In the first wave of AI-assisted claims, accuracy issues left most adopters disappointed and skittish about further implementation. Without real value from early stage implementations, insurers became wary of further development. According to Deloitte, implementations were unsuccessful because of legacy IT infrastructure challenges, poor data and AI foundations, and inadequate collaboration between business functions.
When accuracy is an issue or legacy systems clash with new technologies, AI fatigue can creep into your workforce, leadership, or claims team. Claims documents contain nuanced medical terminology, legal language, and contextual relationships that require domain expertise, and early AI implementations failed to account for some regulatory requirements. The result was AI fatigue, resistance, and poor adoption rates.
Ready for the New Way Forward?
So what is the solution? The industry has learned from these early mistakes, and today’s approach recognizes that human oversight is essential. Domain-specific training helps provide the nuanced, audit-ready results claims teams need – with compliance built in. A modern claims documentation platform combines AI with human expertise to turn complex, unstructured records into defensible outputs.
Learn more and get your copy of Wisedocs’ Enterprise Claims Transformation Guide, a quick resource for everything AI in claims and how organizations are moving beyond AI fatigue, and towards scalable, defensible AI-powered claims processing automation today.
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