Jillian Badanes, growth and innovation lead for the Americas at Swiss Re, emphasized the need to focus on business processes and stakeholder involvement when implementing artificial intelligence (AI), rather than taking a technology-first approach.
Badanes shared these insights with AM Best during the 129th Annual NAMIC Convention in Denver.
When discussing her message at the conference, Badanes noted that while AI is essential for the future, carriers should not adopt it without a clear business strategy.
“Carriers do need to invest, but they should think about what makes sense for them and not just start with a tech-first approach, but think about the business problems, think about their business strategy, and then look for use cases that make sense for them,” she said.
On the topic of leveraging AI and machine learning to improve underwriting accuracy and customer service, Badanes highlighted the potential for AI to handle routine tasks, freeing up underwriters to focus on higher-value activities.
“Things like data entry, going back and forth with agents, searching on the internet to validate information. A lot of that can be made more efficient with the help of AI and allow underwriters to spend their time doing the things that they really do best, the analysis, the evaluation, the critical thinking,” she said.
When asked about the use of AI in catastrophe modeling, Badanes pointed to advancements in AI-based models for dynamic perils like wildfires. She mentioned Swiss Re's collaboration with Google’s innovation arm, which resulted in a wildfire model using 600 different variables to forecast the likelihood of wildfires over the next one to five years.
“It's really unlike anything in the market. We brought it into our cat net platform to make it available for underwriters. We expect that a lot of catastrophe models will evolve to include this sort of AI,” she said.
Badanes also identified potential pitfalls in using AI, stressing the importance of focusing on the business problem and involving relevant stakeholders from the start.
“The other is really considering the responsible use of AI and how can you make sure that these models are designed for explainability, make sure that they're free from bias. These are sort of things that are coming up in the models and developing a rigorous review process is really critical and it's a space that we've been working on and supporting our clients in,” she said.
Regarding how Swiss Re is using innovation to address insurers’ evolving needs in the Americas, Badanes explained that her role focuses on understanding client needs and using technology to address those challenges.
“We also look at the capabilities of AI, of data analytics, and think about what we can do bespoke for clients. We try to take a very iterative approach, so we start small, we build a prototype, we test, we get feedback, and if it works, then we continue to invest and roll out. Really side-by side with our clients,” she said.
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