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- 73% of insurance CEOs see AI as a major investment priority
- Business leaders have "made significant progress in understanding AI"
- Productivity is still a major attraction, but compliance and security can be concerns
New KPMG data has revealed that nearly three-quarters (73%) of insurance CEOs now see AI as their top investment priority, with the technology increasingly used across underwriting, claims, onboarding and customer service.
This comes as 92% of financial services companies, per the report, have generated profits from using AI.
However, while many are keen to invest in artificial intelligence, only around one in three (32%) have actually seen returns of any meaningful measure.
Insurance and finance companies are keen to invest in AI
Despite a slow start, they remain hopeful, with two-thirds (67%) expecting AI-derived returns in the next one to three years, up from 21% when the same question was asked two years ago. The same number of leaders also plan to allocate 10-20% of their budgets towards AI.
KPMG described AI as a strategic priority for most insurers, noting that boards and C-1 leaders have "made significant progress in understanding AI" and are now seeing it as a strategic business topic instead of just another IT tool.
However, as with any tech adoption, slow adopters risk being left behind. 'Emerging' insurance companies with limited AI proof-of-concepts are said to have other investment priorities instead, which include building a solid AI foundation.
"As AI moves from experimentation to enterprise capability, organizations that build a foundation that is scalable with quality data are best positioned to realize sustained value," Tech, Data and AI Lead for Insurance Riccardo Altenburg noted.
Still, the outlook is positive with AI generally seen more as an opportunity than a risk. Productivity and efficiency gains are still high on the list, as well as improved quality and data analysis.
On the flip side, compliance and security risks are holding many back, and a growing number of companies are now worried about becoming dependent on Big Tech.
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