Insurance company finds its digital edge in AI

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Epiphanies at innovation conventions are hardly new, but Tim Heinze wasn’t expecting his when the light bulb went off. The director of strategic operations for insurance company AXA XL’s North American property unit, Heinze had just watched a presentation in which an IBM engineer talked about how Watson, the company’s artificial intelligence (AI) software, generates efficiencies in offshore oil drilling operations.

The presenter claimed that the Watson technology could “help one engineer think like a thousand.” “That caught my attention,” Heinze recalls, nodding to the red-hot trend of using sophisticated software to augment work performed by humans.

AXA XL is piloting AI and natural language processing (NLP) software to help populate and process information on commercial business properties. The solution, developed under the moniker Project Spotlight, automates the production of the engineering survey reports that are so crucial for providing appropriate insurance coverage and accurate pricing.

Corporate adoption of AI is soaring, according to Gartner, which says that the number of enterprises implementing AI grew 270 percent in the past four years and tripled in the past year. “Four years ago, AI implementation was rare, only 10 percent of survey respondents reported that their enterprises had deployed AI or would do so shortly. For 2019, that number has leapt to 37 percent,” says Gartner research vice president Chris Howard. “If you are a CIO and your organization doesn’t use AI, chances are high that your competitors do, and this should be a concern.”

AI augments human work

Although it’s early days for Spotlight, for which AXA has received a Digital Edge 50 Award for digital innovation, you can count Heinze as a big believer in the power of AI and NLP to maximize efficiency in the insurance sector, where speed-to-market is increasingly important.

As part of the underwriting process, AXA risk consultants (RCs) assess surveys on commercial properties and summarize them in reports, grading 10 risk factors and capturing other key attributes about each location, for the underwriting team. Among the details they consider: Is a plant situated next to a dynamite manufacturer? Does it have an adequate sprinkler system? How far is the nearest fire station?

Creating the summary reports for underwriters had always been a tedious and manual task. What if, Heinze wondered, AXA could use software to compile, read and score these reports? For Project Spotlight, Heinze and his team used an AI/NLP engine that automatically ingests and reads survey reports and provides a summary with suggested scoring for each of the 10 risk factors and extracts other key location attributes.

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