Artificial intelligence (AI) plays an increasingly important role in our lives, enabling humans and entire industries to rethink how to analyze data and use insights to improve decision-making.
By many, AI is seen as an engine of productivity and economic growth since it can increase the efficiency with which things are done and generate new products and services, thereby boosting consumer demand.
However, as with any new technological development, the use of AI also comes with challenges that need to be assessed and, where relevant, addressed by companies, policymakers, and regulators. Executing AI technology is not “a walk in the park”, having to navigate through the process while minimizing risk and accelerating innovation.
With this in mind, we wanted to find out how AI impacts the European Life and Pensions industry. A Lumera pulse survey was sent to 2,100 recipients working in the Life and Pensions industry in Europe.
Some might say that the impact of AI has been mainly positive so far, bringing contributions that have made life easier in society. AI is developing in a way that is augmenting what humans are already doing, but which a machine can be trained to do faster, more accurately, and much less expensively.
It’s well-known that the Life and Pensions industry is sufficiently complex and notoriously slow to evolve. However, we believe that AI carries great transformational potential. Adding the power of AI and automation across your core business operations will facilitate digital customer interaction and optimize operational efficiency. Furthermore, AI enables more fine-tuned, individually targeted solutions, and AI-driven insights can enrich complex L&P advice, while routine tasks are automated.
According to the Lumera Pulse survey, most L&P providers are in the early stages of investigating AI to assure they have the necessary resources to future-proof their business. Only a few are already using AI, but some have no plans at present for AI. As L&P providers become more experienced at using advanced technologies to enhance decision-making, lower costs, and optimize the customer experience, the pace of change will most likely also accelerate.
Below please find the detailed result of the survey:
1. How important is AI to the future for organizations within Life and Pensions?
To the future for organizations within Life and Pensions, AI is Considerably important (41%). Second is Crucial (22%) and Fairly (22%), followed by I Don’t know (9%) and Irrelevant (6%).
2. What are the 3 top benefits for insurers leveraging AI?
The 3 top benefits for insurers leveraging AI are Operational efficiencies (72%), Improved customer experience (70%) and Reduced operational costs (54%), followed by Optimizing business decisions (46%), Increased flexibility (22%) and I don’t know (11%).
3. What is the biggest challenge in implementing AI?
The biggest challenge in implementing AI is Internal data science skills/resources (40%). Second is Ethical risks (24%), followed by Data privacy (16%), Other (Regulatory constraints, Project management and Technology) (11%) and I don’t know (9%).
4. Before implementing AI, which is the number one use case Life and Pensions companies should start with?
The number one use case Life and Pensions companies should start with is Business insight (24%). Second is Claims processing (20%) and I don’t know (20%), followed by Product management (11%), Risk of Lapse (11%), Document management (7%), Pricing 5% and Winning new clients 2%.
5. What is your company’s level of AI adoption – to assure you have the necessary resources to future-proof your business?
The number one level of AI adoption – to assure you have the necessary resources to future-proof your business – is We are in the early stages of investigating AI (41%). Second is I don’t know (24%), followed by We have no plans at present for AI (20%), We have AI solutions in production (9%) and We are developing AI solutions (6%).
6. What other technology trends will also be important in the coming five years for decision-makers in the Life and Pensions industry?
Other technology trends that also will be important in the coming five years for decision makers in the Life and Pensions industry are Automation (70%), Robotic Process Automation (RPA) 37%, Smart contracts (28%), Blockchain (17%), I don’t know 13% and Internet of Things (IoT) (9%).
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