Underwriters often have hundreds of pages of documents to sort through but probably not for long. Insurance carriers are using generative AI as copilots in back-office operations.
Copilots can act as chatbots, virtual assistants, search engines and productivity tools.
Deloitte principal Sandi Suhrada said the technology can be used across the value chain in insurance, including product development, innovation, sales and marketing, underwriting and claims.
“Most traction is in three areas. One is underwriting. Second is claims and third is personalized servicing. Many of our clients are building underwriting copilots,” said Suhrada.
Suhrada explained a use case. “One of my clients has actually built an underwriting copilot for their Spanish specialty insurance business line. And, the reality is, it’s actually a big lift for the underwriters. So they actually do their day-to-day. It’s helped streamline the underwriting process, because It can help you process vast amounts of data, such as customer information, medical records, risk factors, and then provide you with insights into risk assessment, pricing models, and compliance with underwriting guidelines.”
Copilots are built
“There’s a lot going on under the hood,” said Indranil Bandyopadhyay, principal analyst at Forrester.
Bandopadhyay said, ‘When we write something in a language understood by humans, we must first process it, this is called natural language processing,’ said Bandopadhyay. “So, it needs to be understood and then it needs to fetch that information. It’s not just a big language model. It still needs an API or a query or an old-fashioned ID to fetch it. And then the biggest advantage of the big language model is that it lets you can respond humanely. It’s two-way traffic.”
Some of the heavy lifting has been done by LLMs, Bandyopadhyay added, but insurers still need an omnichannel strategy and 24/7 operations because a copilot or LLM won’t be able to help in terms of customer experience and better engagement without them.
“Once those things are in there, then it can help you. … The LLM in this context is the icing on the cake. So if you don’t have a three- or five-course dinner plan, and if you don’t have dessert. , and dessert inside , if you don’t give the icing on the cake, it won’t save the day,” Bandyopadhyay said.
Montaux, an insurtech with AI and actuarial modeling technology, in February launched Model CoPilot, an AI CoPilot designed specifically for actuaries.
Julien Balasingam, chief growth officer at Montaux, said via email: “Insurers are interested in using Model CoPilot, our latest product, to enhance the work of actuaries. It helps them understand, document and maintain their models. This work is typically time-consuming, Manual and often described as tasks that we actuaries don’t like to do. Current AI copilots are good at eliminating time-consuming tasks and enabling insurers to use their high-value resources on work that creates strategic value for the business.”
Patrick Davis, SVP Data and Analytics at Majesco, said at the start of 2023 there wasn’t much of a framework for the idea of what CoPilot was, but Microsoft had hype surrounding its product launch. Majesco has also released its own copilot in collaboration with Microsoft.
“We took a cue from Microsoft’s branding and they were indicating to a copilot what to do and then we had to figure it out and plumb ourselves,” Davis said. “You really have to curate your data and craft it in a way that a big language model can understand. … We started with the ability to query complex insurance data.”
In spring 2024, Majesco plans to introduce a number of functions, automating parts of the user interface workflow such as copying quotes, canceling policy sets, and creating correspondence, Davis said. copilot is integrated into the Majesco platform and has an icon and chat option on each screen.
Davis said the technology will likely never replace underwriters. “There’s a lot of nuance in what an underwriter thinks and how they price things. We see generative AI and copilots, in general, useful throughout the insurance lifecycle but also in claims and underwriting. … I think it can save underwriters and agents a lot of time on claims.” Because it can look at a 20-page document provided by an agent and answer questions on it, summarize a claim history based on a question or interaction with a co-pilot.”
Davis added that copilots help in task-based roles.
“If you think about everyone [the] Financial technology organizations in this world, whether it’s a bank or an insurance company, they probably have significant back office operations, like clerical work and sending emails and doing things that are low-hanging fruit,” Davis added. When these technologies come into play, it helps people make will do [insurers] Already more efficient. Repurposing some of those back office jobs is probably going to be something
Michael Nadel, senior director of insurance at Simon-Kucher & Partners, said copilots and chatbots, for example, are not new concepts.
“Copilots have been around for a while with varying levels of maturity,” Nadel said. “Some of these LL.M.’s are pushing it much further than where it has been.”
Nadel added that co-drivers can also serve as a knowledge transfer option.
“Getting smart on policy within a career, historically it took years to build product level specific knowledge,” Nadel said. “The copilots can take it
