Insurance in the age of AI

As we move into 2020, a new reality is emerging in many traditional industries. History and vestiges of working is becoming more of a competitive impediment, not a strategic advantage any more.  New competitors, uncertain macroeconomic conditions, newer distribution channels and customers demanding 24/7 hassle free experience are posing many challenges to traditional incumbents who are used to conducting their business in a particular way. This holds true for traditional insurance companies that still run their business same way as they have been for decades. For traditional companies, competing with digital rivals involves not just investing in some software or a fancy chat-bot that can converse on 8 languages. It requires rewiring the Insurance agency’s organization and delivery model.

AI means different things to different people. For most, AI conjures up images of robots doing human tasks. In spite of all the panic monger predictions on AI and how software will be taking over human jobs in near future, no one can deny the significant role AI plays in business. Primary objective of AI based work is to let humans work more like humans and less like robots. With AI, humans and machines can complement each other leading to higher productivity. AI is increasingly revealing itself as an enabler than a disruptor.

To transition from a traditional Insurance agency to an AI-driven, organization requires a holistic approach. Based on our work with variety of clients, we have come up with following principles as common best practices for leading AI led transformation.

Unified strategy:

Rewiring an Insurance agency’s operating models requires rebuilding the complete business on an integrated foundation of simple yet common workflows, data, and analytics. For Insurance agencies that have inorganically grown over years with disparate systems and non-standardized process across different regions, what it means is, to arrive at consistent top-down vision and mandate to align many bottom-up and across business unit efforts. Take an outside-in approach to know what the market wants and find data to show what clients, providers, and partners think of your agency and ask what needs to be changed. Re-think how your business is structured and begin incorporating data and intelligence into your business to make it an agile and learning organization.

Process to Productization:

 For many years Insurance process is performed by specially trained manpower. Insurance process, whether front, middle or back-end are labor intensive, expensive and prone to errors. As we all know, humans have their bad days, and get tired or more likely to make mistakes when in  rush.  With AI, Insurance agencies can automate their process making them agile and reliable. Smart algorithms not only do a proficient task but   also work 24 hours without a break. AI can enable Insurance agencies move away from rigid service process to smart individualized service process following real-time customer choices. Standardize and productize all process, whether front, middle or back-end. Decompose the process to determine which parts of each process is best handled by software and which part is best handled by humans.  To realize the benefits of AI, go beyond traditional Business process improvement approach. Developing a productization approach is key to AI led changes.

Focus on the Policyholder – not the policy:

Traditionally, Insurance agencies are built to suit siloed channel, operational, product, marketing and regulatory requirements. AI led transformation is to connect client engagement platforms with back-end systems to provide world class customer experience. Moreover, AI applications must bring nimbleness to “middle” office to mitigate complexity and create optimal interactions across front end and legacy systems. True power of AI lies in helping clients make better and faster decisions.  Evaluate the complete purchase cycle from a policyholder’s perspective: search, evaluation, negotiation, purchase and post-purchase. AI application must enhance the following for a policyholder:

Design customer experience without borders:

With AI traditional Insurance agencies must extend beyond existing channels, connect to new channels rapidly and always deliver a seamless experience to the customer. AI led transformation must drive centralized intelligence and ubiquitous access to deliver a continuous, relevant and personalized experience for members on any channel across multiple channels. Must connect to legacy systems and take advantage of native mobile applications to provide context rich and personalized customer interactions every time. Conduct a customer walkthrough audit, measure the time and efforts customer spend at different stages to complete a task and rejig the process completely breaking down the barriers and silos.

Train and Empower Staff:

While agencies may need time to build capabilities in AI software, analytics and data science, the talent and experience needed to change to an AI led workforce is often on the payroll already. What most agencies miss is the investment in the right tools to help them change, test and deploy quickly without much disruptions to existing business. AI that can fast-track innovation and enhance productivity with low-code and role-based authoring experiences is easier to deploy. Visual models, and agile methodology and strong partners can help design AI applications that are always up-to-date, easy to adopt and ready to deploy where you need them.


With AI led changes, the agency becomes more connected and open to do business with customers and partners. While, as a respected corporate entity the agency is dedicated to run its business with highest integrity, there are forces outside in the market that are constantly looking out for any vulnerabilities. Stress test your AI solutions continuously, audit your infrastructure and adopt best practices stay secure.

In sum, Insurance in the age of AI  comes with unprecedented scale fraught with complexity. Traditional insurance agencies need to build right culture and systems to leverage AI smartly. AI holds the potential to automate processes, dissect and provide valuable insights from large data sets and enable better informed decision making. Deployed smartly, AI can unleash unparallel competitive advantage.

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