As AI evolves, many wonder whether it will replace human workers in insurance. Perhaps the more relevant discussion would be how AI presents an unprecedented opportunity to unlock the value of human expertise across insurance operations.
The insurance industry has always been people-centered and knowledge-intensive, leveraging deep expertise and nuanced judgment to solve people’s problems in good times and bad. While AI brings powerful capabilities, at its best, it should not function end-to-end without human involvement. Instead, AI revolutionizes the work of underwriters, claims managers, and other experts by eliminating the routine, repetitive tasks that consume valuable time and energy.
Consider an underwriter's daily workflow. Hours are spent manually reviewing applications, extracting data from documents, and performing initial risk assessments. AI systems can automate these tasks with remarkable accuracy, freeing underwriters to focus on complex risk evaluation, relationship building with brokers, and strategic decision-making—all areas where human expertise truly shines.
Similarly, claims adjusters traditionally spend significant time processing paperwork, verifying coverage details, and conducting preliminary assessments. AI can streamline these processes, allowing adjusters to dedicate more attention to complex claims investigation, negotiation, and customer service.
The “secret sauce” of insurance AI implementation is the Human-in-the-Loop (HITL) approach. This ensures that AI systems operate with appropriate human oversight and guidance. HITL integrates human expertise at critical junctures in automated workflows—and gives people control over when AI should seek human oversight.
For example, an AI system might flag potential inconsistencies in a claim, but a human adjuster makes the final determination based on their expertise and judgment. This collaborative approach combines AI's speed and pattern-recognition capabilities with the critical thinking and ethical reasoning of human professionals.
The HITL approach offers several advantages:
For years, insurance companies have turned to Business Process Outsourcing (BPO) to handle high-volume, routine tasks. While BPO offers up-front cost advantages, it often comes with challenges, like communication barriers, quality control issues, and limited scalability.
AI presents a compelling alternative to BPOs. By implementing intelligent automation systems that work alongside in-house teams, insurers can bring previously outsourced functions back in-house without increasing headcount to deliver greater control, more consistent results, and improved quality—often at significant cost savings compared to traditional outsourcing models.
Moreover, AI systems never sleep, don't take vacations, and can scale instantly to meet demand spikes, providing consistency and reliability that BPO arrangements often struggle to deliver.
Insurance companies face constant pressure to minimize revenue leakage—whether through premium underpricing or claims overpayment. Traditional approaches to these issues often involve adding more checkpoints and manual reviews, creating friction in the customer experience and additional work for staff.
AI offers a more efficient solution. By rapidly and accurately analyzing historical data and identifying patterns, AI systems can:
These capabilities directly impact the bottom line while simultaneously reducing the burden on underwriting and claims teams. For instance, an AI system might notice that a particular type of commercial property is consistently underpriced relative to its loss history, allowing underwriters to adjust their approach proactively.
Speed and accuracy often seem like competing priorities in insurance operations. Faster processing typically comes at the expense of thoroughness, while meticulous review slows cycle times.
AI transforms this equation by delivering both increased speed and improved accuracy. AI-powered insurance AI systems:
For underwriters, AI offers a pathway to more business won via quotes generated in less time and with greater confidence in pricing accuracy. For claims professionals, AI is the key to faster claim resolutions, reduced claims leakage, and delighted policyholders.
As recent research shows, organizations that excel at maximizing their return on talent generate significantly more revenue per team member. This highlights the importance of strategic workforce planning—ensuring you have the right people with the right skills at the right time.
In insurance, AI implementation should be paired with thoughtful workforce development. This includes:
The most successful insurance organizations view AI not as a replacement for human talent, but as a catalyst for workforce transformation. They invest in their people, helping them develop the skills needed to thrive in an AI-enhanced environment.
The future of insurance isn't about AI replacing professionals—it's about AI empowering underwriters and claims adjusters to accomplish more than ever before without experiencing job burnout. By automating routine tasks, providing decision support, and enhancing analytical capabilities, AI allows insurance professionals to focus on what they do best: exercising judgment, building relationships, and delivering exceptional service.
In this collaborative future, AI handles the routine while humans do their best work to create an insurance industry that's more efficient, customer-centric, and profitable than ever before.
Read our 2025 State of AI Adoption in Insurance Report for insights and perspectives on AI adoption from more than 240 insurance executives.