Why Insurers Should Embrace Data and Algorithms

I’ve seen many insurers experimenting with AI - but only a few are realizing transformational value. In our latest report, which I had the pleasure of co-authoring, we examine what truly separates AI leaders from the rest. The results were striking: 📈 Over the past five years, insurers leading in AI achieved 6.1x the total shareholder returns of AI laggards. This is more than a technology advantage, it’s a strategic imperative. So, what sets the AI leaders apart? ✅ They take an enterprise-wide approach to AI—not isolated pilots. ✅ They rewire their core processes: underwriting, claims, distribution, and customer service. ✅ They build a modern capabilities stack—scalable infrastructure, high-quality data, and reusable components. ✅ They invest just as much in change management and workforce enablement as they do in technology. ✅ They view gen AI and agentic AI not just as tools, but as differentiators capable of reasoning, empathy, and creativity. AI is becoming the defining force of competitive advantage in insurance, and the gap between leaders and laggards is widening fast. 📘 Explore our perspective here: https://lnkd.in/ekaV_Jyy #Insurance #AILeadership #GenAI #DigitalTransformation #FutureOfInsurance #AgenticAI #InsureTech #McKinseyInsight #FinancialServices

The industry with 6x the TSR vs. the average 2–3× is… insurance. Insurers that lead with AI aren’t just keeping pace, they’re creating 6× the shareholder returns of laggards. The reason? Making bold choices about where to build, buy, or partner ... and rewiring the business, not just dabbling in pilots. Often cast as risk-averse, insurance shows the opposite here: when insurers center strategy with AI, the rewards are exponential. Leaders have created six times the shareholder returns of laggards over the past five years. My colleague Tanguy Catlin has spent years guiding insurance and financial-services clients through transformation. He and our insurance colleagues highlight that, to win, insurers can double down on four of the six rewired components: (1) Business-led roadmap: tie AI directly to value creation, not tech curiosity. (2) Operating model at scale: embed AI into how the business runs, not just in pilots. (3) Flexible AI stack: technology designed for speed, modularity, and distributed innovation. (4) Adoption & change management: because even the best AI fails without human adoption. Here’s what outcomes look like for insurers who get serious: domain-level transformation has already yielded a 10-20% lift in new agent success and sales conversion, 10-15% growth in premiums, 20-40% lower cost to onboard customers, and 3-5% improvement in claims accuracy. These aren’t incremental tweaks, they move core levers that impact the top and bottom line. Full article linked below and authored by Nick Milinkovich, Sid Kamath, Tanguy Catlin, and Violet Chung, with Pranav Jain and Ramzi Elias. https://lnkd.in/df2GXpuq

AI is transforming insurance! Here’s how: Generative AI is revolutionizing predictions. With 34% of insurers finding it most effective in predictive analytics and which in turn now enables better demand analysis, ensures companies are prepared for market changes. Automated customer advice is another game-changer. Personalized experiences are now possible, enhancing customer satisfaction and loyalty. Natural language processing (NLP) and voice recognition improve underwriting processes, making them faster and more accurate. Fraud detection has seen significant advancements with AI-driven image recognition. This technology helps identify suspicious activities quickly, reducing financial losses and enhancing security. Productivity has notably increased in countries like Germany, Spain, and Austria. A 0.5% boost in productivity can lead to a 1% decrease in labor costs. This is crucial as the EU-27 workforce is expected to shrink by 20% by 2050 due to an aging population. Contrary to popular belief, AI is not a job killer. Allianz Research shows AI is more likely to boost productivity and skills rather than cause mass job losses. AI can help address labor shortages and aging workforce challenges. AI in insurance is about balancing innovation with regulation. It’s about leveraging AI’s benefits while addressing concerns. The goal is to enhance efficiency, improve customer experiences, and maintain robust security. If you’re in the insurance sector and want to harness the power of AI, let’s talk. Our team at CellStrat is here to help you navigate this transformation and solve your unique challenges. Reach out to us today for a consultation!

We are at a pivotal moment where our traditional expertise meets the infinite possibilities of #AI - not just to maintain our leadership, but to reinvent it.   I often say that #insurance is first and foremost about People, Tech and Data. Today, AI is reshaping our industry by amplifying the power of this equation.    The greatest challenge we face? I believe it is not technological 🤖 but profoundly human.    AI is not here to replace the insurer. It's here to empower us to focus on what is important: to protect what matters with more precision and empathy than ever before. Thanks to a thoughtful balance between innovation and ethics, automation and human contact, we are shaping a new future for insurance.    AI should not be a simple race for productivity - it is also about enriching our experiences and relationships as human beings. The results we are starting to see speak for themselves: more relevant solutions, enriched customer journeys, strengthened distribution networks.     The insurance of tomorrow is taking shape before our eyes: hyper-personalized policies, advanced geospatial analysis, claims processed in minutes thanks to computable contracts... This vision is not a distant dream 💭 - we are building it today.    The pace and quality of this evolution will depend on our ability to use our data responsibly and, consequently, to train our teams to ensure conscious decision-making.    The road ahead will be one of continuous adaptation and collaboration to bring our deep industry knowledge and AI’s potential together. With the right balance of innovation and responsibility we will open new possibilities for the future of insurance – with the aim of creating solutions that genuinely serve our customers and partners.    I’m optimistic and excited about what we can achieve all together.