AI Calculates Repair Costs Automatically

Financial Services Commission Chairman Eun Sung-soo visits the Korea Insurance Development Institute on July 9.

Artificial intelligence-based car insurance services are scheduled to be introduced next year so that post-accident handling can be facilitated and expedited. The South Korean government is planning to set up a working group this month so that the services can be promoted based on deregulation, infrastructure establishment and better consumer protection.

The purpose of the services is to automatically calculate repair costs by AI determining the degree of damage and necessary repair parts based on pictures of a damaged vehicle. This system is a combination of AI and the Automobile repair cost On-line Service (AOS) currently in use by insurers and auto repair shops. Specifically, the pictures are transmitted to the AOS server of the Korea Insurance Development Institute, the AOS analyzes the pictures and automatically calculates repair costs, and then the data is transmitted to an insurer, an auto repair shop and the owner of the vehicle.

The owner can immediately receive the repair cost data in the event of an accident. On the insurer’s part, more accurate claims adjustment is anticipated and its work can be expedited as no on-site process is required. The AOS is capable of identifying duplicate pictures and thus double insurance claims can be prevented. Quicker repair cost claims are possible for repair shops, too.

“The AOS analyzed one million pictures of damaged cover panels from April 2019 to April this year to record a matching rate of 70 percent to 80 percent for those cases with a repair cost of less than 900,000 won,” the Korea Insurance Development Institute explained, adding, “The AOS is equipped with algorithms applicable to 170 models of sedans, SUVs and so on and is capable of covering 90 percent of all vehicles.”

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