AI as ‘complementary’, not a replacement for the insurance industry – Zurich

In the world of business, the rapid advancement of AI has generated significant debate and concerns around its potneital impacts on various industries – with insurance no exception.

With the capability to revolutionise processes, create tools and improve customer servicee, AI’s development has garnered both excitement and fear among industry professionals.

Much of this fear is prompted by a lingering question in the minds of many – is AI a friend or a foe to the insurance industry?

Will Edwards, head of SME at Zurich, firmly believes that AI is a friend. He said the technology “offers unforeseen benefits” and therefore “has a place in the insurance industry”.

Speaking to Insurance Times, Edwards explained that he believed AI could be used “as a complementary offering, rather than as a replacement [for workers].”

Live chat advantages

The notion that AI can complement insurers and brokers by allowing them to automise repetitive tasks and focus on more important work has been steadily gaining traction in recent years.

This notion was proved somewhat when the pandemic struck. While the traditional insurance business model proved resilient, the rate of digitalisation within the sector accelerated when companies were forced to build digital systems to allow workers to perform their jobs remotely. 

And as the insurance sector has emerged from the pandemic, readily available AI technology has emerged to demonstrate “unforeseen benefits” as the world moves to digital platforms.

Edwards acknowledged that the insurance market, including Zurich, has made significant technological advancements in recent years – especially with regards to live chat technology.

Live chat technology refers to a digital communication tool that enables real-time, text-based conversations between businesses and their customers or website visitors. It typically appears as a chatbox or widget on a website or mobile app, allowing users to engage in instant messaging with a insurer’s representative or chatbot.

He explained: “[Zurich] saw a big change in live chat demand over the last few years. In 2022, we handled more live chats from brokers than we did telephone calls for the first time.

“We have also seen an 8% increase in live chats in Q1 this year, compared to Q1 in 2022.

“That said, if brokers want to reach us by phone, we’re committed to that – but we’re finding digital channels are growing in popularity”.

Edwards explained that this shift in approach has received positive feedback from brokers, as it allows them to engage with their clients over the phone while simultaneously communicating with Zurich in real-time.

He added: “Before, [brokers] would have had to put down the phone [in order to contact Zurich separately]”.

Edwards added that, in a live chat scenario, utilising digital trading leads to achieve quicker responses and enhanced customer service, benefiting both the broker and the customer.

A human touch

However, while some remain sceptical about the loss of human interaction in an AI-driven environment, Edwards dispelled such worries by describing Zurich’s approach to AI integration.

He clarified that Zurich’s live chat proposition was not dominated by “robotics or AI”. Instead, every live chat session is supported by a human underwriter, preserving the crucial personal connection between underwriter and broker.

Edwards explained that the reason for this AI and human integrated approach was because “building relationships between people is vitally important”.

He continued: “From a work point of view, it is massively important to build relationships in our focus. From a personal [and wellbeing perspective] it is important for [Zurich’s] staff to build relationships with people as well.

“So, not only is it really important for businesses to build relationships, it’s really important for our staff to build relationships with people.”

AI’s place

Based on Zurich’s approach to AI technology integrated with humans, Edwards said he firmly believes that AI “has a place in the insurance industry”.

It will “benefit [the industry] in ways that [we cannot foresee] in the next 20 years,” he added.

To illustrate the point that AI “complements” the industry, Edwards referenced the introduction of Mircosfot Excel, which many initially believed may replace accountants.

He explained: “[We have] ended up hiring more accountants than we had in the past because [the increased availability of data required additional expertise to manage it effectively].”

Similarly, Edwards said he believes that “AI can be a very similar situation, where we actually can use it to look at data in ways that we haven’t in the past and provide even better service.

However, he was careful to emphasise the importance of human involvement in utilising AI to its fullest potential. He said people would be necessary to deliver the outcomes that AI can assist with.

Therefore, Edwards said that he “see’s [AI] as a complement to our offering, rather than as a replacement.

“To me, it’s something that complements rather than changes.”

In embracing AI as a complement, the insurance industry can navigate the changing landscape while preserving the vital human touch.