AI Is Transforming Insurance With Five Emerging Business Models

Abstract

Artificial intelligence and related technologies are creating new opportunities and challenges for organizations across the insurance value chain. Incumbents are adopting AI-driven automation at different speeds, and new entrants are attempting to use AI to gain an advantage over the incumbents. This research explored four case studies of insurers' digital transformation. The findings suggest that a technology focused perspective on insurance business models is necessary and that the transformation is at a stage where we can identify the prevailing approaches. The findings identify the prevailing five insurance business models that utilize AI: (1) focus and disaggregation, (2) absorbing AI into existing model, (3) incumbent expanding beyond model, (4) dedicated insurance disruptor, and (5) tech company disruptor.