As 2024 begins to pick up steam, the insurance sector in APAC is faced with one big opportunity – or one big threat, depending on your perspective.
Naturally, we are talking about AI.
There seems little doubt that the entire business landscape is about to be transformed by the power of computers to use large language models (LLMs) and AI to transform human productivity and the nature of work.
At this stage, it is impossible to quantify the effect that this might have – although the US-headquartered Congressional Budget Office is forecasting extra growth on the back of the new technologies across the board of 1.4%, while experts think the real figure could be double that.
In studies of specific job roles – such as customer service – the implementation of LLMs saw productivity gains of 14% and above, so the potential is undeniable.
Experts warn that it might take a decade until the full benefits of introducing LLMs and AI become apparent and this chimes with what Asia Insurance Review is hearing in conversation with insurance industry leaders.
Many senior insurance figures have acknowledged the importance of this new technology to the sector in Asia Pacific – but when pressed to provide practical examples of how they are using the technology, most struggle to give compelling answers.
There are many ‘ifs’ and ‘buts’ and blue-sky thinking but there are far fewer concrete examples of how and where the technology has been employed in insurance and what the savings or efficiencies have been.
In recent weeks a senior leader from an insurance intermediary in mainland China told Asia Insurance Review, “Insurance CEOs really struggle to understand how AI can be deployed in their businesses.” China is often regarded as a leader in insurance technology and one conclusion that can be drawn is that if Chinese CEOs struggle, other CEOs in the region will be experiencing at least the same level of difficulty.
Meanwhile, a member of the C-suite from an Australian life player told us that the carrier was using AI to speed up customer service, scale-up front-line quality assurance and enable cyber security solutions to distinguish real from fake documents. Hardly the revolution that we have been promised.
We also hear of experiments in life distribution where AI provides ‘deepfake’ videos, scripts and voiceovers for agents and brokers who are not photogenic, polished in front of a camera or literate enough to write a compelling pitch. Such a development might leave some customers feeling rather uncomfortable.
The lack of ‘big’ AI applications may simply mean that it is still too early to have tested the new technology rigorously – or it could be insurance CEOs being coy about sharing knowledge with competitors.
And, of course, these same CEOs are well aware of the other side of AI – which is when it is wielded by fraudsters to commit cyber crime. We are already hearing tales of the integrity of motor claims being called into question by deepfake crash images that have been generated by malignant actors.
In any event, the answer seems to be simply ‘wait and see’ where the technology takes us.
Paul McNamara
Editorial director
Asia Insurance Review