As the summer months get underway, the annual midpoint of the year presents an opportunity to reflect on the state of the industry. While the insurance industry has spent the last two years chasing the Gen AI wave, the next chapter of digital transformation is already unfolding.
The next phase of insurance technology isn't about better interfaces or faster processing—it's about systems that think independently and take coordinated action. This shift promises to revolutionize how insurers operate. While there is great potential there is also a need to keep a watchful eye on effective ROI and regulatory compliance with the new technology.
Unlocking enterprise power
Agentic AI is set to transform enterprise software in the insurance industry, multiplying value, through automating mundane tasks, enhancing personalization, and improving customer engagement. With the ability to process and settle claims instantly, AI can speed up the claims process and reduce errors. The potential of this technology promises to be more than an efficiency play, they allow organizations to reengineer workflows and scale AI-driven decision-making, allowing for the continual breakthrough and innovation.
Demonstrating Clear Value
As insurers continue to invest in dynamic, powerful agentic tools, the expectations for value, notably among consumers, will continue to increase. Indeed, consumers are spending wisely these days, placing a premium on value. A wide degree of skepticism remains among consumers currently who question how well insurance companies are leveraging Gen AI to improve their services. Insurance leaders need to recognize that while the value of AI agents today involves driving efficiency, their true power lies in reshaping entire workflows and business models. To effectively demonstrate return on investment, insurers need to continue to prioritize a clear AI strategy with definable and measurable metrics, align AI deployments with strategic objectives, and establish robust data governance.
Enhancing regulatory compliance
As noted, robust governance will be needed to ensure adherence not only to current laws relating to AI, but also anticipating emerging AI, privacy, and information protection regulations. Insurers recognize trust is the most important commodity with consumers and therefore it is critical to ensure the protection of customer data and provide clear explanations of how these systems work to meet current and evolving regulatory requirements. Adoption will stall if trust isn't established that the technology will act responsibly. Clear risk mitigation and human-in-the-loop oversight will be essential in the technology's early deployments. In the back half of the year, insurers will need to continue to look at how to develop and implement strong governance and ethical frameworks, training their staff, and focus on growing regulatory areas surrounding fraud including privacy, cybersecurity, and identity theft.
The road ahead
Any digital transformation will come with challenges, but the potential benefits of agentic AI is one insurers are optimistic about. By addressing regulatory compliance and building trust through bolstered use of the technology, insurers can create a more innovative, personalized, and secure future for their customers and stakeholders.
