Gen AI Set to Revolutionize Insurance, but Foundational Work Remains

The adoption of generative AI (Gen AI) across the re/insurance sector promises transformative changes, yet significant groundwork is needed. A recent whitepaper by Oxbow Partners reveals insights from interviews with senior leaders at 22 major re/insurance firms, highlighting the long-term potential and current challenges of Gen AI.

The study involved 22 of the largest re/insurers and specialty players worldwide, including senior leadership figures. The whitepaper was published on July 3, 2024.

Gen AI offers the potential to revolutionize the insurance industry by enhancing efficiency, accuracy, and innovation. However, the technology is still in its early stages, with firms focusing on building foundational capabilities. Understanding the current state and future potential of Gen AI is crucial for industry stakeholders aiming to stay competitive and innovative.

Oxbow Partners' research shows that while Gen AI is recognized as transformative, many firms are still in the foundational stages of adoption. Key barriers include data security, management focus, and the readiness of underlying models. Additionally, the talent gap in AI expertise poses a significant challenge. Despite these hurdles, executives are excited about Gen AI’s potential and are investing in governance frameworks and foundational capabilities.

Miqdaad Versi, Partner and Head of Gen AI at Oxbow Partners, emphasized the importance of a deliberate strategy for AI and Gen AI. Elizabeth Jenkin, Underwriting Director at the Lloyd’s Market Association, highlighted the substantial potential benefits of Gen AI for the specialty and reinsurance sectors.