CCO CONNECT EXCLUSIVE
Improving claims management is a key initiative for insurance carriers, but these efforts often fail to hit their mark. “While carriers aspire to use digital tools to enable the human touch, anticipate and respond proactively to customer needs, and prevent incidents that result in claims, our benchmarking analysis of global carriers reveals their progress may fall short of their aspirations; few have effectively executed their visions end to end,” says Jacqueline Montgomery, partner, McKinsey & Company.
Montgomery and Amy Enrione, associate partner, McKinsey, will deliver a presentation entitled, “How Generative AI Can Rewire Claims Management and Transform the Claims Experience,” at CLM’s CCO Summit, which will be held during CLM’s Claims College in Austin. The session will focus on GenAI and the role it can play in claims management. “We will explore the advantages GenAI can bring to claims management, potential applications for its use along the claims value chain, and ways chief claims officers can use it to propel their organizations forward—which may accelerate carriers’ visions of a transformed claims experience for claimants, claims professionals, and others in the claims ecosystem,” says Montgomery.
Montgomery spoke with CLM and answered some questions about GenAI and what attendees can expect from her presentation:
Q: For both industries and individuals, generative artificial intelligence is not coming soon; it’s already here. We’ve all played around with tools and talked about how we might benefit from this technology. For claims departments, what does this mean? Have you seen any claims departments that have fully embraced this technology? If so, what have been some of the benefits and obstacles?
Montgomery: GenAI is revolutionary in its ability to understand and generate content (text, images, audio, and video) with human-like quality and speed. Dozens of potential GenAI use cases across the claims value chain could be reimagined, which may lead to step-change improvements in efficiency, accuracy, and customer experience.
Although carriers are experimenting with GenAI, there is still potential for carriers to reimagine the way claims are handled and rewire their organizations. By moving thoughtfully to reconsider where GenAI could add value to the way work is done end to end, carriers could realize holistic impact.
Importantly, carriers must embed proven risk management practices like ensuring claims handlers work in partnership with GenAI tools to ensure moving responsibly while capturing the value of the technology.
Q: How would you describe the insurance industry compared to other industries with respect to interest in and adoption of generative artificial intelligence? What about claims departments relative to other parts of insurance, such as underwriting?
Montgomery: The insurance industry shows high interest in GenAI, with over 80% of executives identifying it as a priority over the next two years, per a recent global McKinsey survey. Moreover, more than 80% of executives identified claims and operations as the two domains where they plan to focus their GenAI efforts first, indicating a higher interest in transforming these areas compared to others like underwriting and policy administration. The existing maturity of data science in insurance is both a challenge and an opportunity: Rich historic and synthetic data aid training within important risk and legal protocols, but complexity in knowledge management and defining quality outputs can be a challenge.
Q: What specific areas of the claims process do you believe will see the biggest impact from generative artificial intelligence? Can you explain that expected impact?
Montgomery: GenAI could advance AI capabilities significantly, meaning that solutions used in conjunction with analytical AI and other tools could have an outsized impact across the claims process. Although dozens of GenAI use cases exist across the claims value chain, four are gaining special interest from carriers as good places to start:
Many CCOs are already identifying these and other GenAI use cases to capture the value at stake, and some are implementing ad hoc solutions to address each one. The most successful CCOs will think bigger, setting a bold vision for their organizations to innovate and invest in the process redesign and change management needed to transform claims.
Be sure not to miss Montgomery and Enrione’s presentation at the CCO Summit in Austin on Wednesday, Sept. 4.
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Phil Gusman is CLM's director of content. phil.gusman@theclm.org
