#USA #Montreal #Equisoft #LIMRA #UCT

A recent study conducted by Equisoft and LIMRA in collaboration with Universal Conversion Technologies (UCT) highlights a pressing concern among global life insurers regarding their preparedness for artificial intelligence (AI). According to the report, 78% of respondents assert that data readiness poses the most significant challenge to unlocking the full potential of AI. While a majority of companies rate their data readiness as 'progressive', an alarming 46% admit to lacking adequate preparation for AI implementation.

As Mike Allee, President of UCT, states, 'Data is foundational to everything a carrier does, now and in the future.' He adds that many carriers have not adopted a holistic view of their data practices, leaving issues of data quality and integrity still in progress. This insight correlates with the report's main finding: that achieving data readiness is crucial for becoming AI-ready.

The report introduces the Global Data Readiness Benchmark, which serves as a comprehensive maturity model assessing carriers across six essential dimensions: organizational alignment, infrastructure, sourcing and integration, quality and integrity, governance, and analytics. This model enables providers to evaluate their current status and compare their readiness relative to their peers.

Dr. Kartik Sakthivel, Vice President and Chief Information Officer at LIMRA and LOMA, emphasizes the importance of high-quality data, stating, 'Without it, the outputs of AI systems will be fundamentally flawed. Bad data leads to bad AI.' He urges organizations to prioritize data governance, quality, and integrity to fully leverage AI's capabilities in driving meaningful business results.

The report also offers a glimpse into global trends, noting that carriers rated themselves as 'Progressive' in AI data readiness. Among the notable findings:

• - Insurers from Australia emerged as the leaders in data readiness across all dimensions, while North America lagged behind other regions.
• - A significant 87% of respondents are applying AI across various operational facets like underwriting and new business processes.
• - Machine learning ranks as the most commonly used AI technology, with expected growth in natural language processing and large language models.
• - Data governance remains a significant concern; although many organizations have developed governance guidelines, low adoption rates reveal a substantial opportunity for improvement.
• - Those carriers already utilizing AI face challenges stemming from technical and scaling issues, as well as misinformed assumptions during project planning.

Regionally, the report presents some key findings:

• - Australia performed strongly overall, with 38% of its insurers rated as 'Optimal' in data readiness.
• - Latin American carriers surpassed global averages, with 82% classified as 'Progressive'.
• - Conversely, 66% of U.S. life insurance carriers feel unprepared for AI, showing stronger organizational alignment but weaker sourcing and integration.
• - Canada received low scores, although its infrastructure was the strongest aspect, indicating a need for enhanced sourcing and integration strategies.

To gain a deeper understanding of these trends, the full report titled 'Assessing Data Readiness for AI in the Life Insurance Industry' can be downloaded from Equisoft and UCT's webpage. This research not only serves as a crucial resource for life insurers but also sheds light on the current landscape of AI adoption across the sector, paving the way for future advancements and initiatives aimed at improving data quality and leveraging AI technologies effectively.