Artificial Intelligence Usage in Insurance Industry Widespread but Constrained by Size
February 03, 2023
This study surveys U.S. insurance professionals on deployment of artificial intelligence within their organizations, seeking the current state of AI usage.
HARTFORD, CT – February 3, 2023 – Artificial intelligence tools have become all the rage, with a variety of new general use software tools capturing headlines in 2023. Within the insurance industry, the potential uses of AI along the value chain – in sales, claims, back office, for example --- have been promised, but how many insurers have deployed AI in these areas? For those insurers that have yet to use AI in their operations, what is holding them back?
Conning's “2023 Focus Series: The Current State of AI in the Insurance Industry" is its first survey of the U.S. insurance industry in AI deployment, analyzing responses based on insurer qualities (sector, size, IT spend).
"Adoption was in the majority, with 61% of respondents either having implemented or in the process of implementing AI as a part of their workflow," said Manu Mazumdar, a VP of Insurance Research at Conning. "However, there was a large size effect, where insurers under $100 million in annual direct premium written (DPW) had a low likelihood of adoption, at only 35%. There seems to be a certain minimum scale needed before pursuing AI is worthwhile in insurance.”
“One of the very interesting results was that the larger the insurer, in terms of DPW, the more likely they were to develop their AI projects in-house as opposed to using outside vendors,” said Mary Pat Campbell, a VP of Insurance Research at Conning. “Larger insurers may see a greater need for control and customization to their product portfolio, while smaller insurers are more likely to be able to use more standardized AI products for their needs.”
"People are seeing the potential for AI to disrupt many industries," said Scott Hawkins, the Head of Insurance Research at Conning. "This survey lays a baseline for where the industry stands, and gives indications of the barriers players see for further deployment."
The Conning focus study, “2023 Focus Series: The Current State of AI in the Insurance Industry" analyzes the adoption of AI within the insurance industry, including which types of companies are more likely to have already implemented AI, how they are doing so, and barriers to the implementation of AI.
“2023 Focus Series: The Current State of AI in the Insurance Industry" is available for purchase from Conning by calling (888) 707-1177 or by visiting here.
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Conning (www.conning.com) is a leading investment management firm with a long history of serving the insurance industry. Conning supports institutional investors, including insurers and pension plans, with investment solutions, risk modeling software, and industry research. Founded in 1912, Conning has investment centers in Asia, Europe and North America.
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