Insurers using AI to deliver coverage consistency, says Graham

Insurers are already using AI to help ensure they deliver consistent coverage across programmes and close wording gaps, Julia Graham, CEO of UK risk management association Airmic, told delegates at our Global Programmes Europe conference.

Speaking during the opening panel discussion on the digital revolution in the insurance industry, Graham added that technology is speeding up the renewal process. But she feels that insurance buyers still have to wait too long to get an answer back from insurers once data is submitted.

Graham and her fellow panellists agreed that brokers are leading the digitalisation charge that is helping to speed up processes in the commercial insurance market, cut frictional costs and attract more capital. But they stressed that collaboration is needed between all parties to move things on further.

“I am already seeing from where I sit in Airmic talking to partners, that AI is driving collaboration…particularly within the same insurer that offers different policy wordings for the same risk in different parts of the same country or globally. This is now being picked up and some of the holes in those wordings are being closed by clever use of AI,” said Graham.

This means that insurance byers will enjoy more consistent cross border and in-country policies. It will also mean that carriers remove inconsistencies in their wordings and potentially reduce claims disputes.

Another area where digitalisation is helping smooth the risk transfer process is renewals, according to Graham.

She said digital processes are already speeding up renewals but added that insurers are still being too slow to respond after the data is gathered.

“I think the biggest frustration for buyers at the moment is that the renewal process is speeding up and requires less data, but I think the answers [from carriers] at renewal are still too slow. So the process up to that stage is definitely improving but the answers are still coming very late in the day,” said Graham at the event sponsored and supported by CNA, Marsh, Allianz Commercial, Sompo International, Generali, and held in association with Airmic and the IRM.

Swiss Re Corporate Solutions, HDI, Lockton, Tokio Marine HCC, QBE, WTW, BPL Global and TMF were also sponsor partners at the event held at London’s Leonardo Royal Tower Bridge Hotel.

Graham said during the event that the focus of digitalisation among brokers and insurers should be on what clients want, and stressed that this requires collaboration between all parties.

“It needs collaboration. There is no one insurer, there is no single broker. We have no choice but to work together and I have seen some really exciting things, particularly in the area of data and innovation,” she said.

Fellow speaker Dawn Miller, commercial director at Lloyd’s, said she is seeing two digital trends, one improving processes and platforms within service providers and one helping to attract more third party capital to the market.

“The first trend is within organisations to digitise platforms and the like. But we are also seeing a really interesting trend of third party capital that is now very interested in the insurance market. They are seeing an opportunity and can sit behind the new technologies and the new products that we see coming through,” said Miller.

“So there is a push from us and others to make it easier for that third party capital to understand very tightly, well defined, new and innovative products that can address protection gaps. We are creating an avenue for that capital to feel as comfortable in the insurance market as it does in other areas,” she added.

The panellists said that brokers are often the ones pushing the boundaries when it comes to using digital tools to gather data.

“At the moment brokers are leading the use of data. We are leading the way in using that data in the broking process to get the best cover and price for our clients. I can also see changes in the way underwriters use our data,” said Karen Gorman, global services and solutions leader Europe, corporate risk and broking at WTW.

She believes that connecting the different parts of the market and various companies is where the real challenges lies in digitalisation and technology.

“The connectivity needs speeding up. We are all coming up with our solution – brokers and insures – and clients are digitising for their own purposes to run their business, and the connection between is an issue. That is where I see potential problems,” she said.

Alisa King, chief commercial officer at Marsh, agreed that insurers are benefitting from using data provided by brokers and thinks digitalisation will become increasingly important for clients. But the path to success will not be easy, said King.

She said digitalisation provides a once in a generation opportunity to improve processes in the commercial insurance market but stressed there have been many attempts before that haven’t always delivered.