Artificial intelligence in the specialty insurance market
AI in the Specialty Insurance Market
According to a Concentrix report published this year, 80% of Specialty insurance executives believe digital transformation, including AI adoption, is essential for the industry's survival. And there’s no doubt that AI is considered an industry disruptor. 60% of surveyed executives feel that traditional ways of doing business are being disrupted by AI and other technologies right now. From a data perspective, while a high percentage feel their data infrastructure is "best in class," only 31% feel they are fully capitalising on revenue opportunities during customer interactions.
Adopting AI in Insurance:
AI, including generative AI (GenAI), is increasingly being prioritised in the insurance industry. It can bring many benefits; helping with claims automation, risk assessment and selection, personalised products/services and fighting cybercrime. The capabilities of GenAI are evolving rapidly, providing substantial value and a reality check for insurers not yet in the space.
As excitement around GenAI settles, insurance leaders should understand its limitations and risks. There's a crucial opportunity for insurers to reflect on lessons learned and deliver robust AI strategies.
Investment and Implementation:
Insurance organisations are ahead of the global average in AI investments, but implementation is slow.
A balance of innovation and risk navigation is essential.
Organisations should conduct internal maturity assessments to identify priority areas.
Data-Driven and People-Led Approach:
Successful AI adoption requires a clear transformation plan, solid digital foundations, and clean data.
Upskilling and empowering teams to bridge AI and data is key for long-term success.
AI Integration in Processes:
AI is being used in actuarial models, fraud prevention, customer service, and risk prediction.
Implementation processes can be slow, highlighting the need for mature digital transformation.
Navigating AI Risks:
AI poses significant risks such as confidentiality breaches, inaccurate outputs, and cultural impacts.
Avoiding AI altogether may result in missed opportunities and competitive disadvantage
Strategic Focus:
Insurers are prioritising AI deployments that enhance customer experience through personalised interactions and agile claims processing.
The growing importance of AI being applied to transform both general and specialty insurance markets to drive innovation, and improve operational efficiency. These applications have the potential to not only streamline business activity but also improve decision-making and customer experiences in the industry.