1. Enthusiasm about generative AI continues, with most companies planning to integrate it into their offerings
Generative AI (gen AI) holds significant promise for accelerating innovation in insurance as businesses combine mountains of data and advanced computing power in an effort to transform people’s interactions with their insurance carriers and improve financial results. Overall, insurance leaders see gen AI as a transformative opportunity for
the industry in the long term, likely requiring new partnership models involving insurtechs, traditional carriers, and big technology companies. However, gen AI is still in the early stages, and the potential business impacts (positive and negative) remain uncertain for many insurtechs.
No strangers to assessing risk, insurtechs and traditional insurance carriers are proactively addressing concerns about compliance and accuracy when implementing gen AI. Additionally, businesses are working to ensure that output created by algorithms is held to the same ethical standards as human-created work.
Meanwhile, the industry is striving to figure out the most feasible and impactful ways to use the technology. So far, insurance companies are using gen AI for fraud detection; creating copilots for faster employee onboarding in claims, underwriting, and customer service; and providing the means for workers to extract insights from large repositories of information through intuitive interfaces.
One major challenge of adopting gen AI is training staff, because using the technology typically still requires human involvement. Companies are also weighing which gen AI tools to build in-house and which to get from technology vendors. In the near term, insurtechs will likely take the lead in helping insurers apply this technology, but insurers are taking a long-term view on potentially developing certain capabilities in-house.
2. Businesses are renewing their focus on profitability and solving the industry’s core challenges
More insurtechs these days are focused on collaborating with and supporting traditional insurance carriers—a shift from years past, when it was more typical for insurtechs to challenge incumbents in the insurance and tech industries.
This trend is propelled by pervasive profitability challenges. Indeed, many of the conversations at ITC 2023 touched on the industry’s shift from a focus on growth to a focus on profitability, building on The current economic environment has presented challenges to profitability as businesses navigate complexities in man
