Insurance Insider: AI progress: AI’s pull is strong, but investment must focus on talent too

In this final instalment, we argue that investing in personnel is as critical to success as the tech itself.

Over the summer, Insurance Insider produced its AI progress series, in which we looked at how the insurance industry is already implementing artificial intelligence, what practical gains have been made and where key concerns lie for management and staff.

The series established that the integration of AI is well and truly underway in the insurance industry, laying to rest the question of whether AI is “just a hype” that will pass.

Now it feels like the industry is heading into a new era, reminiscent of the advent of the computer or entering the internet age, which will fundamentally change the way we work in the London market and beyond.

But with this optimism comes key questions that remain unanswered that the industry needs to consider to make the most of the emerging technology.

These questions include: what new skill and knowledge sets will be required by staff to complement the technology? How should staff fill the time freed up by AI to ensure a return? How do we ensure that the umbrella term ‘AI’ doesn’t become a catch-all, diminishing what it is capable of?

Without considering these concerns, the industry may not invest sufficiently in staff development, which could risk slowing progress of AI adoption and evolution.

Carriers, brokers and vendors have already invested significant amounts of money in integrating AI into their processes to assist staff on administrative or repetitive tasks.

Sources said that an AI agent could work like an assistant in a claims department, and underwriters could see AI freeing up time by completing administrative, data ingestion and analysis tasks.

For brokers, improving data capture should give access to significantly more risk insights.

As well as having more time for face-to-face discussions or further data insights, returns could be seen through having smaller teams, saving costs on salaries or indeed keeping the number of staff the same but using the freed up time to allow carriers to write new lines of business or explore new business opportunities.

As it stands, the allure of AI is in its promise and its potential.

One goal will be for staff to be creative in the use of that time gained to create new products, interact with clients and find ways to make the industry even better.

But for market players who are already investing in the technology to attain those goals, some key questions still need to be seriously considered to ensure that AI is being used safely and to its fullest potential.

The first question is one of talent. The fourth instalment of the series asked, “will AI take my job?” and concluded that for now, it won’t – but the series established that the landscape and job description for workers almost certainly will change.

The question for now, then, is what do we need from staff to make sure AI is used to its fullest potential, and how can companies support that?

Claims agents, brokers and underwriters who use AI will need to have the same level of understanding and industry knowledge as their pre-AI counterparts, as well as sharper interpersonal skills, the ability to apply their knowledge across domains such as claims, underwriting and development, and the ability to think creatively to discover new applications for the technology.

It is unrealistic to expect this from staff off the bat, and considerable training and open communication is required to help the staff make the most of AI, and not grow to resent it or see it as an unnecessary extension of their job.

When investing in AI, and evaluating its success post-implementation, insurers need to understand how they would like staff to interact with the technology, and nurture that with support and training – as without staff support, the technology is an expensive waste of resources.

Despite the free time that will become available to insurance staff, there is a distinct possibility that a broker or underwriter’s job will get harder with AI, as greater expectations will be placed on staff to innovate and work to much higher standards, all with a potentially smaller team, as they try to navigate a completely new way of working.

For this reason, the industry needs to ensure it is focussing on not only training staff to work with AI, but ensuring that throughout the business, the term “AI” is properly understood.

Sources worried that the term is being applied to “everything,” including any digitisation software that may or may not use artificial intelligence.

“We are blending many, many things into this overarching statement [of ‘artificial intelligence’]” one senior broking source worried.

This is a concern because without understanding that digitisation and automation are just one step in the history of AI development, further innovation could be stifled.

If a staff member is using AI, but doesn’t understand what the technology is, they cannot be expected to understand how to push the limits of what is it capable of or to use it to its fullest potential.

The insurance industry is in a unique position to taking a leading role in the development as a data-heavy industry, with the ability, talent and funds to invest heavily in AI and make the most of that investment.

Questions remain, and challenges are certain, but AI is here to stay, and the insurance industry absolutely must seize the opportunity.