"As the regularity of these incidents increases, the more difficult it becomes for insurers to manage risk and forecast, process, and assess claims."
- Yohan Lobo, Industry Solutions Manager for Financial Services at M-Files
“The volume and impact of risks both businesses and individuals are experiencing globally show no signs of abating. The volatility of the current economic environment is impacting day-to-day operations, as well as creating strategic challenges in the insurance industry,” said Yohan Lobo, Industry Solutions Manager for Financial Services at M-Files.
Highlighting wildfires, multiple international conflicts with worldwide ramifications, and the recent surge in cybercrime, Yohan believes the burden of work grows for insurance firms in line with market shocks, which is why the sector must ensure their data is structured and automated wherever possible.
“Dynamic interest rates and high inflation means that the work of underwriters and loss adjusters is more complex because of more frequent asset valuations and increasing claims costs […] recent low-interest rates and market turbulence have led to inconsistent investment returns,” said Yohan.
He believes that to adapt to this heightened risk landscape, insurers must consider how information is organised, and whether this allows them to react at pace to market changes. “Adopting AI solutions is the simplest way to automate processes and increase both efficiency and adaptability […] firms that already manage their data in a structured way are best placed to implement this technology.
“There are a range of ways insurance firms can leverage AI, from document creation to workflow automation to intuitive search functions. Prioritising the integration of this next wave of technical solutions will increase spare capacity within firms while allowing them to react instantly and automatically to fluctuating market conditions,” he explained.
Yohan believes that legacy insurance firms, in particular, are always looking at how they can improve their financial and operational performance; “Technological adoption and development will support these goals by increasing productivity in the short-term and improving risk management in the future.”
“Ultimately, insurance firms must be willing to invest in technology, but also to invest in themselves, getting rid of outdated systems or software and spending time organising the data and processes they manage,” he concluded.
