Over the past decade, insurers have poured money and effort into digital. Core policy systems have been upgraded, portals rolled out, mobile apps launched. On paper, a lot has changed.
But here’s the reality: operations are still stuck. Costs remain high, processes are fragmented, and staff are still working around gaps that tech was supposed to solve.
We call this the efficiency plateau.
The recent benchmark study by additiv in partnership with Synpulse, which looked at 190 core insurance processes, confirms it. Even after years of digitization, up to 32% of service costs can still be reduced through automation and AI. McKinsey backs this up, estimating AI can boost productivity in insurance by 30–40% across underwriting, claims, and service 2.
So, the question isn’t if insurers should modernize. It’s how — in a way that’s pragmatic, fast, and low-risk.
Why the old way doesn’t work
For years, insurers have leaned on big IT transformation programs to try to solve inefficiencies. But replacing core systems is slow, expensive, and risky. Projects drag on for years, cost fortunes, and often fail to deliver what’s promised.
Meanwhile, customers expect faster service, regulators expect transparency, and shareholders expect leaner operations. Insurers don’t have years to wait.
There is another way: augment, don’t replace.
That’s where modular, AI-driven platforms — sometimes called “platforms of intelligence” — come in. These sit on top of existing systems, orchestrating people, processes, and data. They bring AI into everyday workflows without tearing out the systems that keep the business running.
The potential is huge. The benchmark study shows that service costs can be cut by up to 32%. PwC research adds that modular cloud platforms can halve the time it takes to launch new products 3. In other words, insurers don’t just save money — they gain the agility to innovate faster.
Where the real gains are
So where should insurers focus first? The benchmark study highlights three big opportunities:
• Customer service: Policy changes, endorsements, and inquiries are still too manual. Automating these can deliver 28–32% savings.
• Claims management: From First Notice of Loss (FNOL) through triage to settlement, processes are fragmented and heavy on manual input. Here, 25–31% savings are possible.
• Quote & bind: Progress has been made, but inefficiencies remain. Automation can unlock 18–23% savings.
• For a mid-sized multiline insurer with €100m in annual service staff costs, that translates into €19–37m in savings every year.
What makes those gains possible? Three key enablers:
1. Structured data capture: Smarter forms, pre-filled fields, and document parsing that improve data quality. From Left to Right: Leena Poikolainen, Product Owner and Marianne Hänggi, Insurance Lead
2. AI for unstructured data: NLP and machine learning that turn emails, PDFs, even video into structured inputs ready for automation.
3. Decoupling business logic from the core: Freeing business rules, workflows, and pricing models from legacy systems so they can run faster and evolve independently.
And this isn’t just about cost. Accenture notes that 40% of insurers now see speed to market as the biggest benefit of AI 4. Efficiency means serving customers faster, opening up embedded distribution opportunities, and staying relevant.
Radical automation in action
Here’s the thing: small-scale, task-by-task automation won’t move the needle anymore. What insurers need is what we call radical automation — connecting entire journeys end to end with AI, while keeping people in control where it matters.
This is more than robotic process automation. It’s about orchestrating complete workflows. For example:
• Automating customer inquiries: AI can now read and understand inbound messages, whether email, chat, or form submissions, and instantly decide whether to handle the case end-to-end or escalate with a next-bestaction for a service employee. This speeds up response times, reduces manual triage, and improves accuracy, boosting both efficiency and customer satisfaction.
• Making sales effortless for advisors: Trigger-based AI nudges help sales advisors act faster and smarter. These prompts surface next-best-actions, highlight cross-sell opportunities, and even pre-fill relevant information. This elevates the quality of advice, shortens the sales cycle, and attracts top talent with a modern, AI-powered workplace.
• FNOL in minutes: A customer uploads a video or sends an email. AI extracts the key details, checks coverage against policy terms, and triages the case. Where possible, claims are processed straight through. Where human input is needed, handlers receive a clean summary of relevant facts, plus AI-suggested actions, enabling resolution in minutes rather than days.
And none of this comes at the expense of compliance. Every action is logged, auditable, and aligned to GDPR and the EU AI Act. Human oversight remains in place — the system empowers people, it doesn’t replace them.
The result? Faster, leaner, more accurate operations, and a better customer experience. And because the platforms are modular, insurers can roll out use cases gradually, proving value step by step and scaling at their own pace.
Speed matters: launching products in weeks, not years
Cutting costs is only half the story. Efficiency is also about speed — how quickly you can bring new products to market.
In today’s world, insurers need to launch new propositions in weeks, not years. Think contextual, embedded protection — offered at the exact moment a customer needs it, whether in a banking app, during checkout, or through an employer platform.
AI-driven orchestration platforms make this possible. With modular building blocks and pre-configured workflows, insurers can design, test, and launch products fast, from event-triggered campaigns to bundled life-and-wealth propositions, and distribute them across channels seamlessly.
PwC found that modular platforms can cut launch times by up to 50%. That kind of speed can be the difference between leading the market and lagging behind.
Breaking through the plateau
Yes, the efficiency plateau is real. But it isn’t permanent.
AI-driven orchestration platforms give insurers a way to cut costs by up to a third, deliver hyper-personalized services at scale, and launch products faster than ever — all without replacing core systems.
The benchmark study by additiv and Synpulse proves the numbers. Independent research from McKinsey, PwC, and Accenture reinforces the potential.
The insurers who act now, and embrace radical automation, won’t just break through the plateau. They’ll claim leadership in the next phase of insurance: embedded, AI-driven, and customer-first.
The next wave of productivity is here. The only question is: who’s ready to seize it?
