58% of insurers see efficiency and optimisation as relevant to AI adoption
The insurance industry is already aware of the benefits that artificial intelligence can bring to the business.
Among all the reasons that influence companies to start using artificial intelligence or to do so in an intensive way, the efficiency and optimisation of internal processes stands out, being one of the most important aspects for more than half of the organisations.
This has been revealed by the sectoral analysis of the Ascendant report by Minsait (Indra Group), which, under the title ‘AI: X-ray of a revolution in progress’, analyses the degree of adoption in private companies and public institutions.
On a second level, 33% of the companies surveyed say that one of the main reasons for implementing artificial intelligence is to improve the experience of both customers and internal users. Three out of ten also mention increasing sales (revenue) by improving the offer or customer knowledge through the use of AI.
In the same vein, new offering and business model (21%), support for data-driven decision making and optimisation of existing data (15%), as well as positioning as an innovative company and entity (8%) are also reasons insurers value for adopting AI.
The report also identifies the use cases that companies are applying and makes a comparison with the overall companies in other sectors. In the case of insurers, companies are focusing on industry-specific operations (100%).
They are also already focusing their efforts on improving risk management and cybersecurity, mainly through the use of third-party software, as well as in the areas of marketing, sales and optimisation of product and service design.
In relation to industry-specific use cases, companies are focusing or plan to focus their efforts on optimising underwriting and risk assessment, through initiatives such as contract fraud detection, satellite imagery analysis, customer profiling and the use of predictive risk models. They are also prioritising improvements in claims processing, such as automated customer communications, support chatbots and automated extraction of information from documents.
Finally, advances in policy issuance and administration, including customer segmentation, churn modelling, customer experience analytics and renewal prediction, stand out.
In terms of barriers or factors slowing down the path to AI implementation, 42% of the organisations surveyed identify data and AI regulation as one of the main obstacles to implementation. A fact that, with the European Union's launch of the AI Act, the first AI law, is driving the development of this digitisation in the sector. On a second level, 38% highlight the challenges related to data governance. Next, three out of ten companies point to lack of knowledge and talent as a key barrier to AI adoption and, at the same level, lack of vision of organisational leaders as another major impediment.
Artificial intelligence key to business transformation
The insurance industry is going through a time of great dynamism, influenced by economic, political and social factors. This poses the need to implement profound transformations in business processes to remain competitive and respond to both the demands of end consumers and the need to optimise operations. Rising inflation and changing consumer habits have led financial institutions and insurers to intensify their innovation strategies.
In this context, artificial intelligence, which has already been present in the industry for some years, is consolidating its position as a key resource for transforming current business models, enabling pioneering levels of personalisation and efficiency. Its impact transcends the financial sector, leading the way to an accelerated transformation in multiple industries and in our daily lives.
‘The insurance sector is already implementing AI on a recurring basis, leading the way in the application of this resource. It is already widely used in key areas of its value chain, such as customer acquisition and real-time service offerings,’ said Ignacio Fernández, Global Head of Financial Services and Insurance at Minsait. ‘Generative AI promises to further boost this ecosystem, opening the door to new opportunities and challenges. Among the most relevant aspects for insurers to consider are the development of digital business models, the automation of processes to reduce costs, the personalisation of services, the improvement of the customer experience and the design of innovative new products, all of which are powered by AI capabilities,’ he added.
The fifth edition of Minsait's Ascendant Digital Maturity 2024 Report addresses the context and degree of adoption of artificial intelligence by companies and public administrations. To do so, it has analysed the information provided by more than 900 organisations in Spain and other countries from 15 different sectors of activity.
