As the UK government increases its focus on artificial intelligence, the insurance sector may need to adapt, Concirrus, a marine insurtech, said in a comment reaction to Prime Minister Kier Starmer’s speech on March 14.
Starmer announced plans to replace some civil service roles with AI. The initiative aims to reduce inefficiencies and generate £45 billion in savings through automation.
“If we push forward with digital reform of government, and we are going to do that, we can make massive savings - £45 billion of savings inefficiencies and AI is a golden opportunity,” Starmer said.
With thousands of government positions under review and AI suited for routine tasks, the civil service may see significant changes, Concirrus said. The potential efficiency gains could reshape operations while altering the role of public sector employees.
Amid the planned utilisation of AI in government, the insurance industry faces similar challenges. For years, underwriters have managed manual data entry and administrative tasks that AI could automate.
By streamlining these processes, AI has the potential to allow underwriters to focus on higher-value decisions, accelerating quote generation, enhancing risk management and increasing market competitiveness, Concirrus said.
Similar to government applications, AI could also lower operational costs in insurance by reducing repetitive tasks such as data input, document analysis and risk assessments. The use of AI could also lead to faster quote processing, improved efficiency and reduced premiums.
According to a recent study by KPMG, the majority of respondent insurers anticipate a moderate to very high return on AI investment, with all respondents saying that embracing AI will give them a competitive edge.
Rather than replacing underwriters, Concirrus said that AI is altering their responsibilities. With AI, underwriters could shift away from doing administrative work and instead move towards strategic decision-making, portfolio management and product development.
Instead of handling data entry or outsourcing submissions, the underwriters may focus more on complex risk evaluation and optimising capacity deployment.
Concirrus said the discussion is no longer about whether AI will influence underwriting but how quickly insurers will integrate it. Companies that adopt AI may gain an advantage, while those that delay risk falling behind. AI may not replace underwriters, but those who use it could surpass those who do not.
“As the government leads the charge in AI-driven reform, the insurance sector must follow,” Concirrus said. “AI is not just a tool for cost-cutting, it’s a powerful driver of efficiency, customer experience and competitive advantage.”
