How P&C Commercial Insurance Carriers Are Approaching AI

In a recent ReSource Pro webinar, Mark Breading, Senior Partner, and Meredith Barnes-Cook, Partner in ReSource Pro’s consulting practice, provided insights from new research which unveiled P&C commercial lines insurance carriers’ strategies and perspectives on the implementation of AI. Here’s a quick recap of some of the key findings they shared.

Which AI solutions are insurance carriers using?

Currently, the two most mature technologies within commercial lines are robotic process automation (RPA) and machine learning. These are seeing broad usage among carriers, with the majority already in production (41% for machine learning and 50% for RPA).

Several less mature technologies are also seeing notable activity. Many carriers are particularly interested in use cases for generative AI, with 72% currently in the strategy development or piloting phases for this technology. However, very few carriers—just 6%—have anything in production at this time. Despite this, we expect activity around generative AI to change dramatically over the next couple of years.

Meanwhile, half of commercial lines carriers are either piloting or already in production with natural language processing, a technology that can help manage the large volume of unstructured data in underwriting, claims, and other areas. Additional areas of interest include image recognition, computer vision, and voice-based AI technology, where 47% of carriers are developing strategies or piloting.

Who is responsible for AI planning and management?

As we look at how insurance organizations are managing their AI activities, it’s little surprise that half of those surveyed rely on their IT department for AI planning and management. This department is already gathering data, deploying technology, and making choices around digital transformation, making it an ideal place to build a strong foundation.

The next group taking ownership is the data/analytics unit. Twenty-two percent of carriers rely on this group, which, like IT, is already adept at using data to drive critical decisions. Meanwhile, 16% of carriers lack a formal structure for AI management, and some delegate this task to a specific area in their organization, like a center of excellence.

How can AI benefit risk management, underwriting, and claims processing?

Carriers see AI benefitting a wide range of business processes, but the top three they believe will see the largest impact in risk management and underwriting include:

  1. Risk Analysis – With the many data sources available today, carriers are realizing that by not integrating AI technology into risk analysis, they are positioning themselves for a competitive disadvantage, either due to adverse selection or overpricing.
  2. Submissions Process – Due to the large volume of unstructured data and documents involved in the submissions process, AI has great potential to drive increased speed and accuracy.
  3. Triage/Prioritization – Carriers believe AI can play an important role in ensuring submissions reach the right hands quickly and efficiently.

AI can also enable automated insurance claims processing and improved accuracy, with potential applications in:

  1. Predictive Reserving – AI can aid carriers in increasing the accuracy of reserves and updating them more regularly.
  2. Fraud Monitoring and Detection – The benefits of AI in fraud detection are tangible, as many carriers have already incorporated the technology into their process.
  3. Triage/Assignment – Just like underwriting, carriers are looking to AI to ensure claims get to the right people at the right time.

Watch the Full Webinar

Check out the full 15-minute webinar for more information about AI in commercial lines, including carriers’ approaches and concerns when it comes to generative AI. To learn more about how our consulting practice positions carriers for future success, be sure to visit our Consulting page.