Insurers Bet on Artificial Intelligence to Sell More and Lower Costs

Insurers face a problem that they can no longer solve solely by raising premiums. Climate events are becoming more frequent, claims are costing more, inflation is putting pressure on indemnities, and customers demand immediate responses. In this scenario, artificial intelligence (AI) is starting to become a tool to change the economics of the business, not just to automate tasks.

This is the main conclusion of a report prepared by Boston Consulting Group (BCG), which states that companies that place artificial intelligence at the center of their operations could reduce their operating costs by about 20% and increase the volume of issued premiums by 3% to 5%, thanks to improvements in productivity, more accurate risk decisions, and greater commercial capacity.

The consultancy warns that the sector is undergoing a profound change. Climate volatility, inflation in claims costs, increasing operational complexity, and an increasingly competitive market are forcing companies to rethink their business model. For BCG, AI has ceased to be a technology for gaining efficiency and has become a factor of competitiveness.

The report suggests that the real leap does not come from incorporating virtual assistants or automating isolated processes. The competitive advantage will lie with insurers that redesign their entire operation around artificial intelligence, a model that BCG calls "AI-first".

Ultimately, AI stops being a support for certain tasks and becomes the core of the company's functioning. Intelligent systems coordinate much of the processes from start to finish, while people intervene when experience, judgment, or supervision is needed to resolve complex cases.

According to BCG, many companies are still developing pilot tests or independent solutions that generate specific improvements but do not modify the functioning of the business. In fact, only 38% of insurers claim to have scaled the use of AI in their core processes.

In practice, this change impacts three key areas of the business.

In risk underwriting, AI can receive documentation, validate data, classify requests, analyze pricing scenarios, and prepare policy issuance almost in real-time. Underwriters can focus on complex cases or those outside usual parameters. BCG estimates that this change could reduce underwriting costs by 15% to 20%.

In claims management, intelligent agents could receive reports, analyze images and documentation, detect inconsistencies, estimate damages, coordinate expert assessments, and prepare compensation proposals, while specialists would only intervene when conflicts, fraud, or highly complex cases arise. The potential savings in this segment reach between 20% and 30% of the costs associated with claims administration.

Insurance distribution would also change. AI would allow for faster quoting, improve the conversion of budgets into policies, identify clients at risk of cancellation, and offer more personalized coverage, increasing both sales and customer loyalty.

For BCG, the main obstacle is no longer developing better algorithms but transforming the organization. The report states that only 10% of the success of an artificial intelligence strategy depends on technology. The rest is related to data quality, process redesign, team training, and creating a governance model that allows for the safe and responsible use of AI.

The consultancy recommends that insurers define a comprehensive strategy, build a unified database, incorporate control mechanisms for automated decisions, and prepare their teams to work alongside intelligent agents. The goal is not to replace people but to free up time from repetitive tasks so they can focus on risk assessment, customer service, and higher value-added decisions.

Although the study was prepared for the global property insurance market, the message also reaches Argentine companies. In a business where profitability is increasingly pressured and response speed has become a competitive differential, artificial intelligence appears as a tool to gain efficiency, improve the insured's experience, and sustain growth without increasing operational structure.

BCG's conclusion is that the window to take the lead is closing. Insurers that manage to transform their processes before others will not only reduce costs but will also be in a better position to attract new clients and grow in a market that is beginning to redefine itself around artificial intelligence.