Much like the broader financial services industry, insurance investment managers have approached artificial intelligence (AI) with caution. But, the benefits and dramatic transformation AI delivers can no longer be ignored. By providing increased agility and scalability to investment accounting and middle-office operations, variants of AI like machine learning (ML), intelligent automation (IA) and predictive analytics (PA) are being used by the most innovative insurers to streamline and automate a range of manual processes that tend to be error-prone and time-consuming.
Some of those firms have already begun to adopt AI to automate investment processes, and address talent shortages and increasing regulatory requirements. But wait—there’s more. Here’s how insurance investment managers can take AI—specifically predictive analytics—to the next level.
No more manual data entry. PA combines data mining, machine learning and modeling to predict future outcomes based on patterns identified in historical data. Imagine eliminating manual data entry with PA auto-populating data fields based on past user entry or portfolio activity, and performing financial analysis like tracking and identifying variances in income, yields or rates to provide explanations and context for financial performance.
Faster, more efficient valuations and analysis. PA can also be used to analyze the history and timing of expected versus actual cash flows on both public and even more uncertain private market investments, to improve and refine future cash flow forecasts.
Significant ROI. Leveraging PA can help investment firms realize cost savings and additional efficiency gains through increased automation, scalability and straight-through processing, while still maintaining full transparency and control. In turn, insurers can focus on increasing profitability by efficiently growing and diversifying investment portfolios while simultaneously reducing risk and operating costs. And because these technologies use data and feedback to learn over time and improve accuracy and output, the sooner you get started, the better. To learn more about how AI can take your firm to the next level, download our "4 AI Technologies, 10 Benefits for Insurance Investment Operations" eBook.