Survey Shows 76% of Insurers Adopting Generative AI

A Deloitte survey reveals that a majority of US life and annuity insurers (82%) have implemented Generative AI (GenAI) in at least one function, compared to 70% of property and casualty insurers. Overall, 76% of insurers have adopted GenAI, yet only 45% perceive its benefits as outweighing risks. Larger insurers are leading in adoption, but many smaller ones remain cautious due to perceived risks. The report highlights the transformative potential of GenAI, while also addressing significant challenges such as data capability and workforce readiness.

Despite the initial experimentation, many insurers find themselves in the early stages of GenAI implementation, with a notable number still at the scoping phase. Limited data capabilities and workforce skill shortages are cited as major obstacles by executives. Insurers are adjusting hiring strategies to prioritize candidates with digital and AI skills and are investing in training to enhance internal capabilities.

Collaboration across various functions and a strong data governance strategy are fundamental for successful GenAI adoption. Concerns regarding algorithmic bias, data privacy, and regulatory compliance are pressing issues, particularly as more states adopt guidelines for AI use in insurance. Insurers are adapting to these challenges with increased governance measures and an emphasis on transparency, especially in light of the evolving regulatory landscape, particularly in states like California and Colorado.