IMPACT OF ARTIFICIAL INTELLIGENCE AND MACHINE LEARNING ON INSURANCE UNDERWRITING IN NIGERIA.

Abstract Although the Nigerian insurance market is expanding and advancing, it is underpenetrated, and there are still certain issues related to risk identification, staff productivity, and inclusivity to customers, namely, in underwriting. The use of the traditional methods of underwriting is normally characterized by manual processes, access to data and subjective decision-making, and therefore limited scalability and accuracy in underwriting processes. The transformational possibilities to revise the underwriting practices are, however, offered by advancements in artificial intelligence (AI) and machine learning (ML). Such technologies allow risk to be more accurately assessed more quickly through automated data analysis, predictive modelling and real-time insights across multiple sources along with other sources of alternative data. In this paper, the author will take into account the potential of AI and ML in changing the insurance underwriting sphere in Nigeria in terms of risk assessment precision, operation cost reduction, fraud reduction, and the accessibility of insurance to the poor. The study finds the ways to digital transformation of the industry by concentrating on the current issues in the industry and the new technological solutions to the current challenges. The results indicate that the strategic implementation of underwriting systems led by AI can make a considerable difference to the efficiency and inclusiveness of underwriting systems, and consequently, precondition sustainable development of the insurance market in the digital era in Nigeria.