What's Possible? Generative AI and Insurance
People & Blogs
Introduction
What's Possible? Generative AI and Insurance
Insurance is fundamentally a people and data business. It revolves around virtual products, protection, and savings that are delivered through sophisticated IT systems or human agents. The next wave of technology presents an exciting opportunity to create a significant impact within the industry.
This is not an industry known for its rapid pace of change or quick adaptation to new advancements, mainly due to stringent regulations and the inherent complexity of the business. With thousands of products, contracts spanning hundreds of pages, and multiple computer systems—some dating back to the 1970s—it is indeed a complex landscape.
Nevertheless, there is a prevailing desire among clients for solutions that are centered around human needs while boosting productivity rather than replacing their roles. Focusing on a few key applications and vertical transformations that scale and create value quickly is essential.
In the area of customer service, where 30 to 35 percent of people are currently engaged in searching and classifying documented knowledge, Generative AI (Gen AI) has the potential to reduce costs by 50 to 60 percent. Similarly, in claims processing, Gen AI can augment information and even write settlement offers to customers in just two minutes. In underwriting, the technology can analyze customer needs to create hyper-personalized coverage.
CEOs are often frustrated by the lack of meaningful productivity gains from the billions invested in digital innovations. However, this is expected to change as insurers begin to deploy these models to improve efficiency and offer better services and products.
Keywords
- Insurance
- Generative AI
- Productivity
- Customer Service
- Claims Processing
- Underwriting
- Hyper-Personalized Coverage
- Digital Transformation
- Efficiency
- Technology Innovation
FAQ
Q: Why is the insurance industry slow to adapt to new technologies? A: The insurance industry is heavily regulated and involves a complex array of thousands of products, lengthy contracts, and outdated computer systems. These factors contribute to its slow pace of change.
Q: What is Generative AI's role in customer service within the insurance sector? A: Generative AI can reduce costs by 50 to 60 percent in customer service by automating the tasks of searching and classifying documented knowledge, which currently occupies 30 to 35 percent of human resources.
Q: How can Generative AI improve claims processing? A: In claims processing, Generative AI can not only augment information but also create settlement offers for customers within two minutes, significantly speeding up the process.
Q: What is the impact of Generative AI on underwriting? A: Generative AI can analyze customer needs and provide hyper-personalized coverage, enhancing the precision and relevance of insurance policies offered to customers.
Q: Why are CEOs frustrated with the current state of digital investments in insurance? A: Despite billions being invested in digital innovations, CEOs often see little meaningful productivity gains. This is expected to change as Generative AI and other advanced technologies are more widely adopted and integrated into business processes.