One of the most important areas for AI applications is healthcare. Today's most significant healthcare breakthroughs heavily include AI. For instance, AI accelerated the process of recovering from the nearly two-year-long COVID-19 pandemic's global impact. AI was used in the healthcare sector for a variety of tasks, including early COVID-19 identification, patient assistance, and drug repurposing. Research and Markets estimate that by 2021, the use of AI in healthcare in India would be worth Rs 431.97 billion, expanding at a rate of nearly 40%.

There's no denying that automation is a long-term goal for many industries. To automate a business is to transform it for the better, and there are so many different ways to achieve such a goal, particularly with AI (artificial intelligence). Even startup owners are looking toward automation sooner rather than later, as automation can help businesses scale without growing pains. That said, what about the world of insurance? While automation affects every aspect of the business sector, it's understandable to be confused about how it might impact the insurance space.

People want fair compensation and benefits, they want flexible working arrangements, and, increasingly, they want to work for employers who are in tune with the major societal impacts of the day, such as diversity, equity, and inclusion (DE&I) and the green economy. If insurance employers can deliver that, then they may be able to tip the scales of what's being called the Great Resignation or the Great Reshuffle. Julia Lamm, principal and global workforce strategy leader at PwC US, and co-author of PwC's Top Insurance Industry Issues in 2022 report, believes that insurers can win the war for talent. She said many insurers are well-positioned to deliver the career prospects, culture, and workplace environments that current and prospective employees are demanding today. "One way that the insurance industry has been'progressive' in how they're tackling post-pandemic and the future of work is that the vast majority of insurance organizations have accepted flexible work arrangements [and] hybrid working models," said Lamm. "Most of my clients in the insurance space have decided to embrace hybrid working. They went through change management over the last two years and were forced to work remotely. They made investments in virtual technology and virtual collaboration tools […] which has been really exciting for the industry. "I think the opportunity that still remains for insurers is in defining a compelling value proposition for why people should come and work in the insurance space.

When it comes to digitization, the insurance space hasn't particularly been at the forefront of leading in technological innovation. And it's only fair as a colossal amount of regulations combined with thousands of users' sensitive information makes the insurance industry cautious in adopting new technologies. But, things are gradually changing! As per Genpact's AI 360 report, the adoption of artificial intelligence in insurance is rapidly increasing, with 87% of insurance carriers investing more than USD 5 million in AI-related technologies each year. Digital revolution is everywhere, increasingly transforming conventional business models and adopting digital solutions.

Insurance is an industry that thrives on predictability. The more certain the outcome, the more insurance firms can be sure to offer fair rates and generate value for customers and shareholders alike. As such, it's an industry that has been slow to adopt new technologies and adapt to global change. Today, however, change is here, and more is on the way. Global megatrends, from the imminent arrival of the self-driving car to accelerating climate change, threaten to disrupt the insurance sector in a way that's never been seen before.

Insurtech entered common vernacular in the market towards the end of 2015, but it's been slow to take off compared to disruption in other areas. A report last year by the European Insurance and Occupational Authority (EIOPA) said that digitisation had not yet reached the point of truly disrupting the insurance sector. For some, the insurance industry faces a unique myriad of challenges, that would naturally hold back new players or incumbents – traditionally seen as slow movers - attempting to embrace new technologies. "The insurance industry has always been perceived to be a laggard," says Jason Sahota, Charles Taylor InsureTech CEO, "and I use the word perceived because that isn't always the case. So, have they used technology yes, was it quite disparate yes, was it difficult to change in a regulatory environment, yes." "There are challenges in the insurance industry which meant it was difficult to bring technology in, so that first generation has been an education of technology coming in and how can it be applied. Whether that is through artificial intelligence, machine learning, robotics, or blockchain," says Sahota.

But with that promise comes risk – perhaps greater than the risks inherent with all new technologies – that the insurance industry needs to consider. The Financial Stability Board released a detailed report this month on the potential upsides and downsides of AI, most of which align with Novarica's research of the technology. Many of the risks highlighted in the report stem from the increasing reliance financial services companies will have on outside technology companies for key business components. Another source of risk is that the results of AI and machine learning may be too complex for humans to fully understand. As the FSB report puts it, "New trading algorithms based on machine learning may be less predictable than current rule-based applications and may interact in unexpected ways."

Some industries are quicker to adapt to technological advancement. The insurance industry may have a mixed record on how well it has used the Internet and various communications platforms but it does not appear to be hesitating on deploying tools that rely on Artificial Intelligence (AI). In fact, it almost looks like every significant player in the insurance industry is picking up efficiencies with AI; especially the providers involved in claims processing. The management of insurance claims is being improved mostly by product leaders within various companies, and their jobs are never simple. In virtually every field, a product leader is tasked with keeping an eye on tectonic shifts in markets and technology, finding resources to address those changes, and manage the day-to-day of the customer experience and engagement. Tracking the almost profound transformations underway in the insurance industry is difficult even for the experts.