Foundations of Intelligent Insurance Systems and Digital Transformation

In the insurance sector, intelligent insurance systems—data-rich environments that exploit AI, Machine Learning (ML), fast data analytics, and automation to transform information into actionable processes—represent an emerging class of intelligent systems at the intersection of intelligent enterprise and intelligent operations. Intelligent insurance promises an inexorable transformation of the industry. Insurers that are at the forefront of adopting intelligent insurance functionalities are expected to be among the winners of the current economic cycle: they are likely to generate new business opportunities and compete more effectively in mature segments. The transformation is powered by an overarching digital strategy—the digital transformation of the insurance sector—which pervades all aspects of the business, from structure and culture to customer experience. Digital transformation enables incumbents to respond to intensifying competition from new technology-enabled players, such as InsurTech and BigTech companies, seeking to capture a share of the insurance value pool. Digitally transforming insurance allows players to exploit the ever-increasing volumes of structured and unstructured data generated by their activities but also by policyholders, third parties, and global datasets by harnessing the full potential of data analytics and AI. It also empowers industry players to rethink and innovate their service portfolio, leveraging smart service technologies (SST) to enhance operational efficiency, effectiveness, and agility, deliver superior customer experience, and, ultimately, increase profitability.