Generative AI will give underwriters the competitive edge

Focus on data quality, building centres of excellence, and training to succeed, says Genpact.

We’re living in an exciting phase for technological advancements and the insurance industry has great tools at its disposal. It’s time to start using them, say executives from professional services and solutions firm Genpact.

As companies grapple with new technologies, it is becoming abundantly clear that artificial intelligence (AI) and its offshoot generative AI (Gen-AI) are emerging as transformative game-changers across industries.

In an exclusive interview with Intelligent Insurer, Suhas Sethi and Manoj Kumar from Genpact shared their perspectives on the transformative potential of Gen-AI in insurance, the challenges faced by insurers and how to overcome these obstacles.

Sethi, global business leader for insurance, introduced the topic with evident passion, saying: “Gen-AI is a wonderful new change, which is going to shake up quite a few things.”

Kumar, global head of data and AI for banking, financial services, and insurance, who has more than 25 years of experience in the industry, echoed this sentiment, saying: “I am very excited about how the industry is adopting these changes and embracing tools for better customer service and experience.”

“We’ve created programmes and algorithms in Gen-AI that are changing how claims are handled in a completely non-manual way.” Suhas Sethi, Genpact

Multiple benefits

According to Genpact’s research, The Gen-AI countdown, insurers rank competitive advantage as the primary benefit of Gen-AI, followed by new revenue streams and business models, and then productivity.

Sethi commented: “A lot of people think that Gen-AI would be predominantly driving productivity and efficiency, but what we find is that it’s helping with competitive advantage.”

He stated that with more companies using AI, pricing competitiveness will give way to product competitiveness.

“We know that by creating new products and making them far more individually customised for the clients, Gen-AI can provide a huge amount of benefit,” Sethi added.

Kumar agreed, stating: “Gen-AI provides the advantage of churning out large unstructured data sources much more quickly and more comprehensively than before.

“This is going to change the way underwriters explore external or unstructured data for additional information.

“Gen-AI is going to bring the competitive advantage for which underwriters have been waiting for a long time,” he added.

“Gen-AI is going to bring the competitive advantage for which underwriters have been waiting for a long time.” Manoj Kumar, Genpact

Connecting data

Despite the promised benefits, insurers face several barriers to effectively adopting Gen-AI, according to Genpact’s research, including a lack of structured plans and investments, and challenges with data quality and strategy.

“Data quality and access are the most integral part of AI technology,” Sethi said.

“A lot of our clients and the industry per se have started to get into the blueprinting and data cleansing, and are modifying how their data is structured, stored, and accessed to be ready for this transformation to happen.”

Kumar added: “If you look at the Gen-AI solutions that the industry is adopting, it has a huge dependency on the quality of data.

“We are seeing carriers now focusing on the quality of their data, including its various facets of completeness.”

Kumar described what other companies are doing to overcome these barriers. “More clients are trying to form Gen-AI Centres of Excellence, to identify the right use-case and a roadmap to implementation,” he explained.

Faster processes

Genpact has led several impactful examples of Gen-AI adoption among insurance companies.

“We are deploying programmes that are transforming the way our associates access their operating procedures,” said Sethi.

He highlighted domain-specific applications to address the onerous and manual process to assess claims, especially when a home has been damaged. “We’ve created programmes and algorithms in Gen-AI that are changing how claims are handled in a completely non-manual way.”

Kumar elaborated on the underwriting process: “We’ve improved the very manual and scattered process of specialty and commercial underwriting submissions with Gen-AI technology, and we’ve encircled that technology through other automation and extractions.”

Focus on training

Another significant barrier is the difficulty in finding, training and retaining talent with AI skills.

This is another area where a Centre of Excellence can help by bringing together and training the right talent to support the business on Gen-AI.

Training is important for Genpact too. “Over the last year or so, we’ve trained nearly 70,000 of our associates on Gen-AI and AI technologies,” Kumar said.

An exciting future

Sethi and Kumar strongly believe that Gen-AI is set to revolutionise the insurance market over the next five to 10 years.

“We have witnessed an extraordinary speed of change where now we have the visual imagery coming,” Sethi said.

He painted a picture of the future. “Imagine complex commercial underwriting being done in minutes and providing quotes back to small commercial or middle markets within a matter of minutes—that’s the future we’re looking towards because it’s all going to change,” he concluded.

Watch the full discussion here: