Xceedance, a global provider of strategic operations support, technology, and data services for insurance organisations, has said that there must be a “significant focus” on generative AI (Gen AI) testing, due to many insurers receiving great results from machine learning, automating tasks in claims and underwriting.
However, the company warns, that without taking the next step, these organisations “will fail to realize the full potential of AI.”
Xceedance explained that the challenge is to “become comfortable with computers making choices, from level and type of coverage to claims recommendations.”
But, in order to achieve that level of trust, insurers are going to have to continue testing again and again, the company noted.
These highlights are based from discussions that Xceedance had with carriers and managing general agents (MGAs) around the world.
In addition, Xceedance stated that this kind of technology raises challenges and opportunities for companies, noting that the successful insurers will combine technology, data, and AI and revise insurance processes from the ground up.
Looking at Gen AI, this particular type of AI requires a lot of data, but Xceedance highlights that there is no shortage of data sources available to insurers, as more is being created every day, from telematics to geospatial data.
But, the challenge for insurers will be integrating data sources into AI platforms so the information can be used to make decisions, Xceedance explains.
Arun Balakrishnan, CEO of Xceedance, commented: “There will be a significant shift in how insurers approach generative AI in 2024. They’ll be looking to advance the ways they apply it across claims, underwriting, and other insurance processes. At the same time, they will be focused on ways to build trust in the technology, make it more accessible to everyone in the organization, and pinpoint the return on their investments.”
Adding: “The impact of AI is not something we’ll see overnight. It’s important for insurers to be strategic, moving quickly in some areas and proceeding with caution in others. We recently created a Center of Excellence for Generative AI at Xceedance, offering opportunities to identify, test and apply AI to insurance processes, particularly when it comes to claims and underwriting. We’re so excited about the potential of generative AI to transform every business, but it’s important to move forward with trust and knowledge.”
