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Insurance brokers often spend years collecting data on clients. Imagine being asked to hand over that treasure chest of hard work, so that its security is out of your hands.
That’s the conundrum many Canadian brokers face when they’re considering whether to jump on the AI band wagon, according to Carlos Benfeito, founder of Quebec-based insurtech, allai. Many companies offering AI capabilities require permission to store a broker’s data within their internal systems. This is causing some insurance professionals to pull the brakes on innovation.
“There’s a friction building in Canada, which we’ve coined as the AI friction. To get over that hump and accelerate the use of AI in Canada, you have to remove some barriers,” Benfeito told Insurance Business.
One of the “barriers” preventing the Canadian insurance industry from a swift AI take-off is the product options available in the market, according to Benfeito. Technology giants like Amazon, Microsoft and Google all offer “fantastic but generic AI capabilities,” which actually need additional “effort and investment” in order to make them work for Canadian insurance, he added.
Chatbots, meanwhile, have become quite standard, simple AI tools. It would be very easy for a broker to invest in a chatbot to answer queries on their website. But in order for that chatbot to bring value to the consumer, and ultimately to the brokerage, it needs to be able to use machine learning to handle insurance specific requests, which will likely require further effort and investment from the broker.
“A second important element that’s slowing down the uptake of AI capabilities among Canadian insurers is the fact that lots of big companies offering these AI services are running them through their own data centres and servers. That means brokers have to hand over their data to an external source,” Benfeito explained.
“First off, this presents typical concerns over data security and cloud safety. Then there’s the added hump of a broker having to hand over their data and their IP to an external source. This data is a broker’s currency, treasure and gold – and there’s a lot of friction involved in handing that over to gain AI capabilities.”
That’s where Benfeito’s allai is a bit different. The insurtech offers ready-to-use AI apps called ‘aims’, which are packaged as a micro-service and can be downloaded by Canadian insurers and brokers to use wherever they decide to deploy it, including from their internal data centres and servers.
“The broker’s data never comes to our data centres. It’s always in their hands, which we hope will help to accelerate AI uptake in Canada,” Benfeito added.
