Insurance Industry’s AI Progress: How Insurers Measure Up and What’s Next

A recent white paper by Boston Consulting Group (BCG) reveals insights into how industries, including insurance, are advancing with artificial intelligence. Although nearly all companies are exploring AI, only 26% are actively using it to generate real value, and a mere 4% are considered leaders in its deployment. The study highlights six key strategies that AI leaders leverage, including a strategic focus on core business processes, high ambition, selective investment, and a people-centric approach. These companies, according to BCG, see higher revenue growth, increased shareholder returns, and stronger employee engagement than their competitors.

For insurers, the report is both encouraging and challenging. Insurance ranks fourth among 17 industries in AI maturity for core functions like claims and underwriting, demonstrating strong adoption of generative AI in its main processes. However, BCG notes that insurers face hurdles in AI literacy, establishing clear ROI, and seamlessly integrating AI with existing IT systems. Furthermore, while the industry has succeeded in enhancing operational efficiency, insurers could benefit from a bolder focus on reimagining processes and pursuing new revenue-generating opportunities with AI.

While insurance is off to a solid start, the report suggests more focused and ambitious efforts could amplify the benefits of AI adoption, particularly in areas like risk insights and customer engagement. As insurers continue to build on their AI foundation, a strategic emphasis on people, processes, and scalable high-priority projects could further position them as AI innovators.