Using artificial intelligence will be essential if insurers are to remain competitive, a new report from Swiss Re says. 

The reinsurer is collaborating with clients using AI to transform underwriting, according to the paper by claims and underwriting innovation and analytics lead Doug Rix. 

The next “evolution in underwriting” will be using different AI models at various stages in the process. 

“A single AI model based on limited data will not be a silver bullet for all customer and underwriting pain points or realise the full potential of AI use. Responsible use of broader customer risk and behavioural data and AI will optimise, accelerate and augment underwriting.” 

Swiss Re says it has pioneered underwriting innovation and continues to do so “by adding AI to the underwriting tool set, combining our strong technical expertise with cutting-edge data analytics platforms”. 

AI models increase sales through better customer experiences, streamline application forms, optimise medical requirements and reduce medical testing expenditure, improve the accuracy of risk selection, reduce the impact of anti-selection, improve automation outcomes and increase underwriter job satisfaction, Swiss Re says.  

“Given ... challenges with anti-selective behaviour, the need to remain price-competitive and have a smooth customer experience, deep technical expertise and strong platform capabilities are key to effectively unlock the potential of AI to evolve our industry.  

“This can present significant investment costs for insurers. The time to develop new technologies and AI capabilities needs to be carefully weighed against improving go-to-market speed.”  

See the paper here.