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AI Technologies Shaping Insurance Industry, Study Finds

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A recent study by Conning reveals that the insurance industry is rapidly embracing artificial intelligence (AI). According to the study, 77% of surveyed decision-makers in the insurance sector are either implementing or considering AI adoption in their operations. This marks a significant increase from the previous year’s survey, which reported a 61% adoption rate.

The research, conducted among C-suite executives responsible for integrating new technologies, also highlights a growing interest in large language models (LLMs), with 67% of companies currently testing these advanced AI systems. Scott Hawkins, a managing director at Conning, emphasizes that insurers are turning to AI to boost efficiency, improve customer satisfaction, and manage vast amounts of data more effectively.

AI Technologies Shaping Insurance Industry, Study Finds

The study examines AI’s impact across three key areas of the insurance value chain:

  1. Sales and Underwriting: AI algorithms are streamlining underwriting processes by analyzing extensive datasets, reducing processing times, and minimizing errors.
  2. Operations and Claims Processing: AI-powered systems are automating tasks such as claim assessment and fraud detection, leading to smoother workflows and enhanced accuracy.
  3. Risk Control and Pricing: AI tools are enabling insurers to assess risks more accurately by analyzing historical and real-time data, ultimately allowing them to offer competitive rates while maintaining profitability.

The survey also identifies machine learning and predictive analytics (ML/PA) as highly adopted technologies, particularly in sales and underwriting. Additionally, it highlights the potential for LLMs across various aspects of the insurance value chain.

Looking ahead, the study suggests that AI adoption will reshape the insurance workforce and drive operational transformations. While implementing these technologies requires significant investments, the potential benefits in terms of customer insights and operational efficiency are considerable.

In summary, the insurance industry’s embrace of AI reflects a growing recognition of its potential to drive innovation and enhance competitiveness in the sector.

Source: Riskandinsurance