IBM collaborates with insurance clients on various fronts to help them navigate their digital transformation journey. The IBM Institute for Business Value (IBV) has identified three key imperatives for insurers: embracing digital transformation to drive revenue growth and improve customer experience, improving core productivity while reducing costs, and adopting incremental application and data modernization using secure hybrid cloud and AI technologies. To successfully transform their companies, insurers must focus on providing digital offerings to customers, increasing efficiency, utilizing data more intelligently, addressing cybersecurity concerns, and striving for a resilient and stable offering.
Most insurance companies have recognized the importance of digital transformation and IT core modernization. They are leveraging hybrid cloud and multi-cloud infrastructure and platforms to achieve their objectives. This approach enables them to accelerate speed-to-market, develop innovative products and services, facilitate business growth, and enhance the overall customer experience. IBM, with its extensive capabilities in AI, is uniquely positioned to assist insurance companies in incorporating generative AI into their business processes. In fact, IBM has been recognized as a leader in AI-related capabilities by Gartner.
IBM works closely with insurance companies to identify opportunities where generative AI can make a significant impact. This includes optimizing processes related to handling large documents and text or image blocks. These use cases already account for a significant portion of AI workloads, and there is a growing trend towards enhancing their functionality using generative AI. Areas where generative AI can make a difference in the insurance industry include customer engagement, digital labor, application modernization, IT operations, and cybersecurity.
IBM has developed generative AI-based solutions for various insurance use cases, such as virtual agents, conversational search, compliance and regulatory processes, claims investigation, and application modernization. These solutions leverage automation and personalized AI to deliver secure and trustworthy outcomes. For example, IBM’s generative AI chatbots can provide personalized responses to insurance product queries, offer comprehensive views of insurance coverages, assist with adding required documents and beneficiaries, and perform other functions to enhance customer engagement.
Insurance agents and contact center agents can also benefit from generative AI-based solutions. These solutions can reduce document search time, summarize information, and enable advisory capabilities, leading to increased productivity and improved customer satisfaction metrics. IBM has been implementing traditional AI-based solutions for insurance companies and is now incorporating generative AI capabilities to enhance agent assistance.
Risk management is another area where generative AI can be applied. By leveraging publicly available data and proprietary experience data, insurers can enhance their risk evaluation and decision-making processes. IBM is working on collecting relevant data and developing foundation models within its watsonx AI and data platform to facilitate this.
Code modernization is a critical challenge for many insurance companies with legacy systems. IBM is using generative AI capabilities to understand the business rules and logic embedded in the existing codebase and support its transformation into a modular system. This process follows industry frameworks and models to guide the redesign and also aids in generating test cases and scripts for testing the modernized code.
While generative AI offers significant potential, there are concerns that need to be addressed. IBM recognizes these concerns and offers solutions through its watsonx platform components, such as AI studio, data store, and governance toolkit. These components provide explainability, ethics, bias mitigation, trust, and compliance capabilities to ensure the responsible and ethical use of generative AI.
In summary, IBM collaborates with insurance clients to facilitate their digital transformation journey by leveraging generative AI and other advanced technologies. IBM’s solutions address key imperatives, help insurers provide digital offerings, improve efficiency, utilize data intelligently, address cybersecurity concerns, and strive for a resilient and stable offering.
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