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ACA Insurance Day 2024: Breakout Session : AI: Transforming the Sector – Strategic Advantage or Challenge?

The 12th ACA Insurance Day once again brought together insurance industry professionals to discuss a critical topic: Artificial Intelligence (AI). The panel, titled “AI: Transforming the Sector – Strategic Asset or Challenge?” provided an in-depth reflection on the opportunities and challenges of adopting AI in insurance. Here’s a recap of the key points discussed by renowned panelists: Sylvia Pucar (Insurance Leader and Audit Partner – PwC Luxembourg), Loïc Le Foll (Head of Wealth Management Group AG2R LA MONDIALE and Managing Director of La Mondiale Europartner), Pierre Nemeth (CEO & Co-Founder – SOPIAD), and Jean-Louis Schiltz (Senior Partner – Schiltz & Schiltz, Attorneys at Law).

A Sector already engaged with AI

From the outset, Sylvia Pucar highlighted a significant advancement: according to a recent study, insurance is among the most promising sectors for AI implementation in Luxembourg. Contrary to common perceptions of the insurance industry as conservative, it is proving to be fertile ground for technological innovation. CEOs surveyed in the study unanimously agreed that generative and predictive AI will play a key role in enhancing products, services, and competitiveness, while redefining internal processes.

Strategic axes for AI in insurance

Sylvia Pucar invited the panelists to first explore the possibilities.
Pierre Nemeth outlined four main areas where AI can transform the industry:

  1. Operational Efficiency: From claims management to integrating unstructured data, AI technologies optimize processes. By reducing processing times by 30% to 50%, AI significantly alleviates repetitive tasks.
  2. Risk Management: AI strengthens risk analysis capabilities, whether predicting natural disasters or detecting fraudulent behavior.
  3. Personalization of Services: Behavioral data analysis enables more tailored products that meet specific customer needs.
  4. Customer Experience: From chatbots to storytelling tools, AI enhances client interactions, offering transparency and clarity in complex services like wealth management.

Loïc Le Foll also emphasized the strategic importance of AI for preserving margins, particularly in Luxembourg, where regulatory pressure and operational costs are high.
The panelists unanimously agreed: while AI is still in relatively simple stages of use, it already saves a significant amount of time.

Challenges to overcome

AI is not only a source of opportunities but also brings several major challenges:

  • Resource Issues: Recruiting and retaining skilled talent is a persistent challenge. With many companies simultaneously adopting AI, the shortage of available resources becomes even more acute. Loïc Le Foll also called for national initiatives to attract and train specialized profiles.
  • Data Quality: Pierre Nemeth stressed the need for high-quality, structured, and accessible data to fully harness AI’s potential.
  • Ethical and Regulatory Challenges: Jean-Louis Schiltz discussed the governance issues related to AI, particularly the need for clear principles to guide automated decisions and prevent discrimination or misuse.
  • Energy Costs: Developing AI requires significant computing power, increasing energy needs and environmental concerns.

The Importance of the human element in transformation

While AI promises efficiency gains, the panelists unanimously reminded the audience that humans remain at the heart of this transformation. “AI must be a tool serving humans, not the other way around,” emphasized Pierre Nemeth. Loïc Le Foll stressed the need to accompany this transition with employee training and engagement, highlighting his company’s initiative to appoint “AI champions” in each department.

An optimistic outlook

Despite the challenges, all panelists expressed optimism about the future of AI in insurance. Jean-Louis Schiltz concluded on a positive note: “The very fact that so many professionals are here today shows that the sector is fully investing in this revolution.”

AI thus emerges as a strategic lever for the insurance sector. When used effectively, it can not only improve competitiveness but also create new business models and meet growing customer expectations. However, its adoption must be accompanied by ethical reflection, solid governance, and investment in human capital.

On the path to intelligent and sustainable transformation, the Luxembourg insurance sector once again demonstrates its ability to adapt to the significant challenges of our time.

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