This article and the accompanying slide deck are part of a series exploring how companies in specific industries can adopt the mindset, expertise, and ambition required to win in an AI-first world.
Life and annuity insurers play a central role in helping people prepare for the future and protect what matters most. AI expands how insurers can deliver on that purpose. Advances in AI are giving life insurers new ways to offer clearer guidance, faster decisions, and stronger support when customers are at their best or most in need.
Leaders are already seeing signs of what is possible and making headway. The difference between insurers leading and falling behind in AI is stark: 60% faster annual revenue growth, 30% higher three-year growth, and 10% greater total shareholder return, according to BCG’s Build for the Future research.
There’s more to come. By embedding AI more deeply in their organizations, life insurers can increase profits 15% to 22% by 2028 through a combination of income-generating and cost-savings moves across the entire value chain.
Why Now
Insurers face rising pressure from demographic change, capital market volatility, new customer expectations, and shifting life patterns. Policyholders want more personalization, less friction, and greater transparency. They want to feel their insurer cares about them. AI is well suited to help insurers focus more effort on policyholders’ real needs.
Across the value chain, early deployments are delivering measurable impact. AI has improved risk assessment accuracy by 30%, lifted lead-to-conversion ratios by 23%, and reduced time-to-quote by 40%. Advanced models can help strengthen capital planning. These improvements let insurers operate more efficiently while offering customers a clearer, more predictable experience.
The reality, however, is that few insurers are scaling AI effectively or emulating AI-first companies, leaving room for large changes in their operations and decision making.
What the AI-First Insurer Looks Like
AI-first insurers organize their work around customer journeys and end-to-end functions—such as underwriting, claims, and product development. Cross-functional teams use shared data and AI-driven workflows to make faster, more coordinated decisions. The policyholder journey becomes more transparent, personal, and supportive. Internally, AI handles routine tasks and speeds workflows that normally require close human coordination. Employees instead focus on advising customers, interpreting nuanced risks, and optimizing tradeoffs among underwriting, servicing, and investments.
- Product Development. Products evolve with customers’ life stages, informed by models that test mortality, lapse, and interest assumptions in real time.
- Sales and Distribution. AI meets customers early in their search, helping them understand needs and compare options. Better matching upfront improves bind ratios and supports advisors.
- Underwriting. Straight-through decisions become standard for most applications. Explainable models use customer data to make faster and more consistent decisions, reducing uncertainty for prospects and policyholders.
- Servicing. Agentic systems resolve a majority of routine requests and guide customers with timely resolutions. Claims processing becomes more immediate. Simple cases can be approved and paid in minutes, easing stress during critical life moments.
- Investment Management. AI-built dynamic scenario models sharpen capital planning and strengthen asset-liability matching, improving returns at the same level of risk.
Taken together, these shifts create a human-centered, connected insurer—one that adapts to customer needs in real time and provides more clarity around decisions. AI-first insurers evolve further from risk managers to instruments of protection and human connection.
How to Get There: Deploy, Reshape, Invent
Leading insurers advance through three complementary plays—deploy, reshape, and invent.
Deploy focuses on clear, near-term productivity gains. Document summaries, advisor copilots, and contact center tools reduce manual workloads and accelerate service.
Reshape redesigns core workflows. AI connects siloed data and embeds intelligence into underwriting, pricing, servicing, and capital modeling. These improvements enhance decision quality, portfolio performance, and operational resilience.
Invent reimagines the future business model. By linking health, wellness, and financial data, insurers can build adaptive products and new forms of value that respond to customers’ needs as they evolve.
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Making It Work
Becoming AI-first starts with alignment and a clear agenda. Most insurers struggle not because of AI itself, but because they fragment their efforts.
A focused end-to-end approach works best. Identify two or three high-impact activities, such as product development and pricing; quote to bind; or claims intake to settlement that require employees with different skills working together. Manage these activities through a thoughtful, enterprise-level agenda.
Culture and capability building must follow early. Leaders should use AI daily, model the behaviors they expect, and encourage experimentation. At the same time, teams will need continual skill-building to work confidently alongside new tools and capabilities.
The Path to AI Impact
AI-first insurers will operate with more transparency, more responsiveness, and more empathy. They will anticipate customer needs, respond quickly to life changes, and make decisions with greater clarity and consistency.
To begin this shift:
- Set a bold, purpose-led AI ambition grounded in improving customer outcomes and business performance by reshaping work flows and processes.
- Choose two or three domains to transform end to end and commit leadership time, governance, and resources to them.
- Invest in foundational enablers such as data readiness, modern tech platforms, and new talent.
- Equip leaders and teams with the skills to use AI confidently in their daily work and to work cross functionally.
- Establish clear governance to track value, ensure responsible use, and reinforce accountability.
Insurers that take these steps now will be positioned to grow, strengthen customer trust, and provide more seamless protection as policyholder needs and expectations evolve.
