The Incremental AI Strategy Is the One Not Paying Off for Insurers

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Language: en
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Hello, this is Josh Hollander
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of Horton International. I am the host
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of the insure techch leadership podcasts
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and I'm pleased
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uh on today's episode to be joined by
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Jim Quick who leads the insurance
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advisory sector for PWC in the US. PWC
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has more than 5,000 insurance focused
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professionals in the US and more than
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14,000 globally. and they work with life
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PNC and specialy carriers and reinsurers
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on business technology and
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transformation.
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This conversation matters right now
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because insurers have spent the last two
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years funding AI pilots and boards are
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starting to ask what those pilots have
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actually delivered. Jim spends his time
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with the executives who have to answer
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that question. Welcome Jim.
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>> Thanks Josh. Thanks for having me.
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>> Yeah, great. So ma maybe just as a
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starting point if you wouldn't mind
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maybe filling a little bit in on the
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blanks of your background and maybe any
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other details of
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um you know the insurance practice at
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PWC and and your current role today as a
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starting point.
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>> Yeah, sure. Um I'm what we call the uh
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advisory sector leader for insurance. So
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I oversee all of our platforms uh for
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consulting uh which are things like uh
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deals, AI, engineering, strategy,
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customer um service um and and risk and
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rag uh all the like. So we're pretty
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diversified business. Um I've been
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consulting in the insurance industry
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probably since uh
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25 years at this point. Uh I've worked
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in uh property and casualty both
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personal and commercial. I've done life
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in annuities and I've done uh quite a
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bit of group benefits work in my
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background. So, um we have a pretty uh
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wide and diversified team. I spend
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probably most of my direct client work
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in the life and uh group benefit space,
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but uh certainly dabble quite a bit in
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the in the property casualty still too.
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So, very passionate about AI and uh all
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the latest trends that our clients are
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um wrestling with.
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>> Yeah. So,
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you know, it just came up the other I
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have a friend and colleague who started
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as an actuary and you know he was using
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Forran to write code for actuarial
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pricing models probably 40 years ago and
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obviously there's you know probably over
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the last decade or so um there's been a
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pretty big you know insure techch and
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innovation wave in insurance and you
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know now we've kind of got this AI wave
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is there anything fundamentally
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different about this AI wave in terms of
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its impact on the industry and the role
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of uh you know sort of insure techch and
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insurance technology innovation right
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now.
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>> Uh my answer to that question is yes and
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no. Um I mean I think if we look back
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over two three decades we have had
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pretty sizable impactful technology
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changes throughout it whether it's the
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internet or RPA and and now AI. I think
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the significance of AI is is different.
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There's exponential opportunity with it.
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Um but I think at its core, we're
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modernizing the industry. We're
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improving how we interact with our
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customers. Um AI and what we're doing
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with AI, the the concepts no different.
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I think the technology is what makes it
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different. um being an industry that
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still has a lot of unstructured data and
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we're not tapping into all of the the
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information and data that that our car
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that the carriers have at their
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fingertips, AI is exponentially, I think
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changing the opportunity and value
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proposition. So what's what's not
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different is we're still like I said
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we're still we're still aiming to be
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more customer centric. We're digitizing
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all the experiences where we can. We are
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you know using data for uh risk
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management underwriting purposes in a
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different way streamlining our processes
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and really all trying to grow. All the
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carriers are really trying to grow and
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serve our customers better. AI just I
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think is a much faster adoptable. It's
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it's somewhat comparable to the internet
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uh adoption is probably the the best
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comparable of kind of the radical change
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as we move through it. But um the the
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things you can do with with AI and the
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frontiers
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um is is gamechanging um and so the the
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possibilities are significant when we
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think about reimagining the the
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insurance value chain. So I it is
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different but the concepts of what we're
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trying to do for the market and for our
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customers are are similar in concept
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>> and and and what do you see as sort of
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making sense in terms of um taking a a
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similar approach or following lessons
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learned from past successful
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you know innovation efforts or
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technology implementation efforts and
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where do you see that maybe people need
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to think differently in terms of the
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application of of of AI.
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>> Yeah, it's a good question. Um, I'm
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going to cite a little bit of we we've
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been doing uh what we call our AI
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performance study and we've been
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studying I mean I was just thinking
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about this earlier this morning. I think
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we're in year four of this. I mean AI
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has been around for decades but really
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it's latest incarnation probably we're
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in year four like from a calendar
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perspective. Um and we've been studying
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we've been studying all industries and
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then specifically zoning in on insurance
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carriers and what kind of value they're
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getting. Um if I compare it to you know
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business process re-engineering or lean
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work or RPA work um I think the carriers
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that are taking more of an incremental
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approach are not seeing the value. I I
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think what makes this different is the
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the the companies and this is across all
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sectors but I I can dubtail into
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insurance. the the companies that are
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getting the most value are the ones that
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are taking the hardest problems and
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really going big, right? They're it it's
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really not a technology problem at its
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core. It is a cultural it's a leadership
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and it's it's the willingness
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to really reimagine and and and be
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willing to take risks in the interest of
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customer efficiency, growth, uh whatever
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angle everybody's situation is in. I the
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ones that we're seeing that that get the
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biggest bang for the buck are the ones
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that are really trying to blow up
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sizable things. They are they're really
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attempting to change the new business
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acquisition and underwriting process in
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in entirety or really trying to change
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the service experience um and
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digitization capabilities or radically
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trying to speed up payments for
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claimants and things like that. So it's
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that's what's different and I we get
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asked all the time uh how much people
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how much are people spending on AI and
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what kind of value they're getting. Um
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and I think you know throwing AI in the
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in the tool in the hands of your
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employees and and trying to kind of do
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things is nice and I think it's a it's a
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mustdo. Um but I think it's really the
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value equation is really where people
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need to anchor. I don't think it's any
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different than any kind of other
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technology modernization when we think
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about business cases and so forth. Um, I
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just think the speed that you can do
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this is way different. And I think in
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years past or decades past, we've spent
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a lot more time analyzing what the
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business case can be. And I think you
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can do it much faster. You can actually
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jump in. Um, and it's less about
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incremental improvement. It really the
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value the value equation here is really
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thinking differently. That's that's what
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makes I think this last couple years and
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future years different than what we've
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seen in the past.
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So how does this sort of you know
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gamechanging
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thinking come about? because you have,
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you know, you just you talked about sort
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of steps in the value chain, right? So,
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distribution and underwriting versus
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claims processes, let's say. Then you've
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got lines of business, obviously, and
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certain organizations maybe are more
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siloed. Then you've had these
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>> innovation groups out there that have
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sort of been trying to bubble up. And
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then you may have the person who just,
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you know, for whatever reason has gotten
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comfortable hopping into a a terminal
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and playing around with cloud code,
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who's somewhere, you know, who knows at
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what level of the organization who might
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have a great idea. So, how do you sort
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of throw all that in the pot and and
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really come up with gamechanging
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innovation of the type you're talking
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about?
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Uh
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it takes it well first step is I think
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people need to be comfortable and
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familiar with the tooling and what
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they're possible. So I do think playing
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with all of the tools that are out there
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uh and you named a few but like
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experimenting with it doing a little bit
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of development work. I I I think we're
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seeing an age where's kind of getting in
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the hands of business folks which is
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pretty exciting frankly because we've
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been I mean people have been trying to
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do that for a long time. So I think
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first first step is you got to be
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familiar with the power of what it can
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do. Um, you know, an example would be an
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agent or broker wants a quote from a
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carrier and like in today's world
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there's a lot of hand typing and stuff
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like that. So, take take an email, take
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a prior plan design, take a quote,
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whatever it is, take a take a picture of
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a building or set of buildings and throw
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it through AI and see what it can do.
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Like that's first step just get
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comfortable with it. Um and then I think
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the second step is the technology is so
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different than what we've done in the
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past with you know pretty
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straightforward deterministic kinds of
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technologies that it it pays to spend a
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couple of weeks to really trust try to
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like what could we do differently now
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that we know what this thing can do that
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really would benefit both my employees
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my you know our ourselves as a carrier
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and then our customers like all three of
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those like what what would we do
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differently if we could do this
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differently. Um, and you know, you still
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need auditable core admin systems. You
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still need, you know, rules and and
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actuarial tables and claims and all that
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stuff, but like really kind of stepping
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up and thinking about doing this
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differently. And and then our
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recommendation is go attack the tough
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problem. The people that are getting the
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most value across industries and
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specifically insurance are the ones that
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are actually attacking the hardest
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problems that have been historically
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difficult to solve for. Uh and then
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getting the and then lastly is getting
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the leadership adoption. Getting the
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leadership um the culture and the
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leadership support uh to go attack it.
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Um and yes, you have to manage the
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risks. There are risks in this
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technology that we've seen that we've
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not seen before. U but really kind of
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going and actually be willing um to
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experiment with it and really try to
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tackle it and if you can't do it um go
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go to the next hardest problem. So those
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are kind of the kinds of things that I
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think we think about with our clients
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and with ourselves. I mean we're doing
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this to ourselves and our businesses. So
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we're living and eating our own dog food
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if you will. So those are kind of the
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steps if I had to broadly just give a
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description on it. So without giving
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away anything sort of confidential or
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anything like that, is there an example
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of two or two of th those kind of big
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problems or or problems that were known
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but you know just the resources weren't
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there to really to really figure out how
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to how to make an impact on them?
00:11:12.079 --> 00:11:15.190
>> Um yeah I mean there's a there's a few
00:11:15.200 --> 00:11:18.790
um just giving some broad I think the
00:11:18.800 --> 00:11:20.389
whole conversation of new business
00:11:20.399 --> 00:11:24.230
acquisition. So that is um identifying
00:11:24.240 --> 00:11:27.990
the risk developing rating for it and
00:11:28.000 --> 00:11:30.310
underwriting decision- making that has
00:11:30.320 --> 00:11:32.230
been a very complicated kind of manual
00:11:32.240 --> 00:11:33.910
data kind of movement. Either you're
00:11:33.920 --> 00:11:35.670
counting on someone to do it for you or
00:11:35.680 --> 00:11:38.150
you're transcribing data and then kind
00:11:38.160 --> 00:11:40.069
of actually making it I like to say it's
00:11:40.079 --> 00:11:41.430
we're kind of making underwriting fun
00:11:41.440 --> 00:11:42.630
again or making underwriting
00:11:42.640 --> 00:11:45.030
underwriting again. um that has been a
00:11:45.040 --> 00:11:47.030
very intensive data entry kind of
00:11:47.040 --> 00:11:48.870
problem that I think AI has greatly
00:11:48.880 --> 00:11:51.990
shown the ability to accelerate. Um I
00:11:52.000 --> 00:11:54.550
think claim processing and the amount of
00:11:54.560 --> 00:11:56.790
documentation that in certain product
00:11:56.800 --> 00:11:58.630
lines the amount of documentation that
00:11:58.640 --> 00:12:00.389
has to come in the door to be
00:12:00.399 --> 00:12:02.150
comfortable and some claim processes are
00:12:02.160 --> 00:12:03.990
very long. uh there's a lot of
00:12:04.000 --> 00:12:06.629
processing for the right reasons can be
00:12:06.639 --> 00:12:08.550
greatly accelerated for just the
00:12:08.560 --> 00:12:09.990
digestion and reading of the
00:12:10.000 --> 00:12:11.509
documentation
00:12:11.519 --> 00:12:13.430
reading you know bringing in some of
00:12:13.440 --> 00:12:15.269
kind of the regulatory rules that are
00:12:15.279 --> 00:12:17.190
out in the marketplace and and so forth
00:12:17.200 --> 00:12:19.990
that just dramatically speed up the
00:12:20.000 --> 00:12:22.550
claimant's desktop it just greatly
00:12:22.560 --> 00:12:24.550
facilitates and then when you need to
00:12:24.560 --> 00:12:26.069
get a second opinion or get another
00:12:26.079 --> 00:12:27.350
expert you can actually kind of
00:12:27.360 --> 00:12:29.190
synthesize all of the material so much
00:12:29.200 --> 00:12:31.910
better um I think AI is actually
00:12:31.920 --> 00:12:33.350
dramatically better at actually
00:12:33.360 --> 00:12:35.350
documenting what people are doing and
00:12:35.360 --> 00:12:36.629
how people are thinking about it much
00:12:36.639 --> 00:12:37.990
more than humans. We've shown that on
00:12:38.000 --> 00:12:40.150
some engagements. Um and then even
00:12:40.160 --> 00:12:41.670
something like a subregation process.
00:12:41.680 --> 00:12:43.430
We've seen radical changes when it comes
00:12:43.440 --> 00:12:46.470
to something like that. So um and then
00:12:46.480 --> 00:12:48.550
you know there's servicing co-pilots to
00:12:48.560 --> 00:12:51.030
make billing work better and and track
00:12:51.040 --> 00:12:53.590
down stuff things like that. So frankly
00:12:53.600 --> 00:12:55.509
it's it's in my opinion it's across the
00:12:55.519 --> 00:12:57.670
full value chain and it's in every sub
00:12:57.680 --> 00:13:00.710
sector. It's in personal lines, it's in
00:13:00.720 --> 00:13:01.910
commercial lines, it's in life
00:13:01.920 --> 00:13:03.509
insurance, it's in annuities, it's in
00:13:03.519 --> 00:13:06.870
benefits, retirement. Um, we're seeing
00:13:06.880 --> 00:13:08.949
significant opportunity in pretty much
00:13:08.959 --> 00:13:11.990
every facet of insurance.
00:13:12.000 --> 00:13:17.030
>> And and is the approach to
00:13:17.040 --> 00:13:20.069
sort of, you know, determining the value
00:13:20.079 --> 00:13:23.829
of these initiatives
00:13:23.839 --> 00:13:25.990
different in any way? I mean, is it an
00:13:26.000 --> 00:13:29.670
ROI calculation? Is it measuring against
00:13:29.680 --> 00:13:33.990
the same KPIs that organizations have
00:13:34.000 --> 00:13:37.269
been measuring against for for years or
00:13:37.279 --> 00:13:39.190
>> is it metrics that you need to think
00:13:39.200 --> 00:13:41.430
about now?
00:13:41.440 --> 00:13:44.069
>> That is a frequently asked question. Um
00:13:44.079 --> 00:13:46.870
I think my opinion of that is I think
00:13:46.880 --> 00:13:48.870
the fundamentals are the same. I I think
00:13:48.880 --> 00:13:51.590
you're still I think we're still looking
00:13:51.600 --> 00:13:54.470
at the benefit case in a similar way. Um
00:13:54.480 --> 00:13:55.910
I think the speed that we can do it is
00:13:55.920 --> 00:13:58.230
different. Um, but I still think we're
00:13:58.240 --> 00:14:01.590
looking at can I can I can I generate
00:14:01.600 --> 00:14:04.069
more premium? Can I manage the risk
00:14:04.079 --> 00:14:06.790
better? Can I be more efficient? Can I
00:14:06.800 --> 00:14:08.710
actually get more customers? Can I
00:14:08.720 --> 00:14:10.870
identify more risks? Can I cross-ell? I
00:14:10.880 --> 00:14:12.389
think all of the same fundamentals are
00:14:12.399 --> 00:14:13.990
still there. So, I think the principles
00:14:14.000 --> 00:14:16.870
of a business case still exist. Um,
00:14:16.880 --> 00:14:18.550
every and every client of ours is a
00:14:18.560 --> 00:14:19.750
little bit different on the pace that
00:14:19.760 --> 00:14:21.110
they go through to develop business
00:14:21.120 --> 00:14:22.790
cases. Some do it very quickly, some do
00:14:22.800 --> 00:14:25.829
it very slowly. Um I I think the speed
00:14:25.839 --> 00:14:27.110
can be accelerated. I think the
00:14:27.120 --> 00:14:31.110
principles of it and I I do my opinion
00:14:31.120 --> 00:14:33.990
also is that early on I think most most
00:14:34.000 --> 00:14:36.230
of the market went after efficiencies
00:14:36.240 --> 00:14:38.710
out of the gate. Our most innovative
00:14:38.720 --> 00:14:40.230
clients are going after growth
00:14:40.240 --> 00:14:43.269
opportunities with this technology. So
00:14:43.279 --> 00:14:45.829
um that is you know bundling more
00:14:45.839 --> 00:14:47.430
products together that is identifying
00:14:47.440 --> 00:14:51.509
risks differently um uh responding to
00:14:51.519 --> 00:14:53.509
underwriting and quote requests in a
00:14:53.519 --> 00:14:55.509
much more rapid fashion that they can't
00:14:55.519 --> 00:14:57.670
get to during busier times of the year
00:14:57.680 --> 00:14:59.750
things like that. So um I think the most
00:14:59.760 --> 00:15:01.670
innovatives are are are looking at both
00:15:01.680 --> 00:15:04.629
the growth side and the cost side at the
00:15:04.639 --> 00:15:06.790
same time or or even more slanting
00:15:06.800 --> 00:15:08.550
toward the growth side. So but the
00:15:08.560 --> 00:15:10.949
principles in my opinion are are the
00:15:10.959 --> 00:15:12.870
same. I think the question we get asked
00:15:12.880 --> 00:15:14.629
indicates that people don't necessarily
00:15:14.639 --> 00:15:17.509
think that's true, but but I still think
00:15:17.519 --> 00:15:19.670
it is a technology. It's it's a
00:15:19.680 --> 00:15:21.189
gamechanging technology, but we're still
00:15:21.199 --> 00:15:22.870
applying it to make people's businesses
00:15:22.880 --> 00:15:25.829
and customer interactions better, you
00:15:25.839 --> 00:15:28.150
know, in a rapid in a rapid way if
00:15:28.160 --> 00:15:29.350
possible.
00:15:29.360 --> 00:15:31.110
>> Is there like a a particular
00:15:31.120 --> 00:15:34.470
misconception maybe CEOs or other CC
00:15:34.480 --> 00:15:39.030
leaders have about AI economics?
00:15:39.040 --> 00:15:41.430
Well,
00:15:41.440 --> 00:15:43.430
maybe. But I think I think the one
00:15:43.440 --> 00:15:45.189
growing topic that we're spending a lot
00:15:45.199 --> 00:15:46.790
of time talking to uh we call it
00:15:46.800 --> 00:15:49.670
tokconomics. It's I I think what we're
00:15:49.680 --> 00:15:51.030
unsure of and it's really kind of
00:15:51.040 --> 00:15:52.470
searched lately is what's the what's the
00:15:52.480 --> 00:15:55.509
hidden cost of it? And I think some some
00:15:55.519 --> 00:15:57.030
companies have actually experienced that
00:15:57.040 --> 00:15:58.870
yes, I was able to save money by
00:15:58.880 --> 00:16:01.030
applying AI, but it's being replaced by
00:16:01.040 --> 00:16:03.910
all the spend with with the tokens and
00:16:03.920 --> 00:16:05.269
data centers and all that kinds of
00:16:05.279 --> 00:16:07.269
things. So I think that's a that's an
00:16:07.279 --> 00:16:08.790
evolving field pretty quickly is like
00:16:08.800 --> 00:16:11.430
what's the actual cost to deploy the
00:16:11.440 --> 00:16:13.189
technology and I think that was a much
00:16:13.199 --> 00:16:14.629
more known thing with previous
00:16:14.639 --> 00:16:17.910
technologies. I I think many companies
00:16:17.920 --> 00:16:20.310
are unsure of that and we're working
00:16:20.320 --> 00:16:21.749
through it pretty fast and pretty hard
00:16:21.759 --> 00:16:24.870
to try to figure that out. Um I I I do
00:16:24.880 --> 00:16:25.829
have some client work where we're
00:16:25.839 --> 00:16:27.910
actually kind of able to quantify that
00:16:27.920 --> 00:16:31.749
um pretty reliably. But I think um
00:16:31.759 --> 00:16:33.189
that's a big topic that I've seen some
00:16:33.199 --> 00:16:35.269
sea suitees having is like how what's
00:16:35.279 --> 00:16:37.350
what's the real cost of deploying the
00:16:37.360 --> 00:16:39.749
technology? How do I throttle back my
00:16:39.759 --> 00:16:43.110
token usage? Am I applying AI
00:16:43.120 --> 00:16:44.870
incorrectly? This is kind of gets into
00:16:44.880 --> 00:16:46.790
like a deterministic kinds of debates
00:16:46.800 --> 00:16:47.509
and
00:16:47.519 --> 00:16:50.310
>> should I am I are my employees all using
00:16:50.320 --> 00:16:52.230
AI for the wrong thing? Are they just is
00:16:52.240 --> 00:16:53.509
are they using it for the equivalent of
00:16:53.519 --> 00:16:55.350
searching the internet um versus are
00:16:55.360 --> 00:16:56.710
they using it for the the things that
00:16:56.720 --> 00:16:59.030
are really powerful? That's a that's an
00:16:59.040 --> 00:17:00.150
evolving process. So are there
00:17:00.160 --> 00:17:01.829
misconceptions? Maybe I think that's
00:17:01.839 --> 00:17:04.069
just an evolving as people are really
00:17:04.079 --> 00:17:05.510
understanding it, getting it into their
00:17:05.520 --> 00:17:07.029
environments, using it for business
00:17:07.039 --> 00:17:09.029
purposes. Those are the things that I
00:17:09.039 --> 00:17:10.150
think companies just have to work
00:17:10.160 --> 00:17:13.669
through. Um it's real. Um I think it's
00:17:13.679 --> 00:17:15.270
going to change quite a bit in the next
00:17:15.280 --> 00:17:19.189
12 to 18 months, frankly. But um so but
00:17:19.199 --> 00:17:21.429
I think most we it's rare that we find
00:17:21.439 --> 00:17:23.029
an insurance carrier that isn't doing
00:17:23.039 --> 00:17:25.829
something with AI and it's rare that you
00:17:25.839 --> 00:17:27.750
don't have senior adoption and boards
00:17:27.760 --> 00:17:29.669
are asking the executives of every
00:17:29.679 --> 00:17:31.750
company we interact with what is your AI
00:17:31.760 --> 00:17:32.870
strategy how you doing it how you
00:17:32.880 --> 00:17:35.510
managing the risk of it. So um it is it
00:17:35.520 --> 00:17:38.310
is it's a incredibly important topic to
00:17:38.320 --> 00:17:39.110
everybody.
00:17:39.120 --> 00:17:42.310
>> Yeah. What about in terms of how this
00:17:42.320 --> 00:17:44.789
flows through to an org chart as you're
00:17:44.799 --> 00:17:46.789
rethinking, you know, these processes
00:17:46.799 --> 00:17:50.950
and and ways of working overall?
00:17:50.960 --> 00:17:54.150
>> Um, as in are there AI like org
00:17:54.160 --> 00:17:55.190
structures or
00:17:55.200 --> 00:17:57.350
>> Yeah, I mean is there you know is an org
00:17:57.360 --> 00:17:59.750
chart? Well, I think a couple things.
00:17:59.760 --> 00:18:01.510
One,
00:18:01.520 --> 00:18:03.669
are some boxes on the org chart turning
00:18:03.679 --> 00:18:06.549
into agents or other types of, you know,
00:18:06.559 --> 00:18:08.789
technology? Yeah,
00:18:08.799 --> 00:18:10.470
>> the layers of the orchard are changing
00:18:10.480 --> 00:18:13.350
with, you know, fewer humans needed or
00:18:13.360 --> 00:18:16.390
>> humans uh being able to take on, you
00:18:16.400 --> 00:18:18.710
know, higher value added tasks while the
00:18:18.720 --> 00:18:20.230
technology takes on some of the
00:18:20.240 --> 00:18:22.310
repetitive tasks like is there
00:18:22.320 --> 00:18:25.590
>> any revolutionary design or is it still,
00:18:25.600 --> 00:18:27.669
you know, you're starting with the the
00:18:27.679 --> 00:18:29.830
board, the CEO, the rest of the seuite
00:18:29.840 --> 00:18:31.270
and then they each have their domains
00:18:31.280 --> 00:18:33.909
and it sort of, you know, flows down as
00:18:33.919 --> 00:18:35.590
as always.
00:18:35.600 --> 00:18:37.190
>> Definitely a lot of conversation. I
00:18:37.200 --> 00:18:39.430
mean, I we've had some slightly humorous
00:18:39.440 --> 00:18:41.350
conversations about whether agents, you
00:18:41.360 --> 00:18:43.270
know, that are being deployed need to
00:18:43.280 --> 00:18:44.950
have, you know, employee ID numbers and
00:18:44.960 --> 00:18:47.990
should they be in their HR HCM system.
00:18:48.000 --> 00:18:50.630
Um, I I I
00:18:50.640 --> 00:18:52.070
think it's real. I think we need to
00:18:52.080 --> 00:18:53.270
account for the agents when they're
00:18:53.280 --> 00:18:54.870
doing things, whether they're completing
00:18:54.880 --> 00:18:56.710
full tasks, whether they're being co-
00:18:56.720 --> 00:18:58.710
co-piloting and interacting with teams.
00:18:58.720 --> 00:19:01.990
I think I think that's early stages um
00:19:02.000 --> 00:19:03.510
based on what I've observed, but I think
00:19:03.520 --> 00:19:04.789
it's a real conversation that clients
00:19:04.799 --> 00:19:06.230
are having is like how do I counter the
00:19:06.240 --> 00:19:08.789
agents? What are they doing? Um how do I
00:19:08.799 --> 00:19:11.669
track them? Who's managing them? Um you
00:19:11.679 --> 00:19:13.270
know, we've had conversations, you know,
00:19:13.280 --> 00:19:14.870
for like a contact center that goes
00:19:14.880 --> 00:19:16.549
fully AI enabled. Would there be a
00:19:16.559 --> 00:19:18.310
command center where you know the
00:19:18.320 --> 00:19:19.909
managers are actually watching screens
00:19:19.919 --> 00:19:21.510
of all the agents interacting with their
00:19:21.520 --> 00:19:24.150
customers and kind of detecting? So, um
00:19:24.160 --> 00:19:26.230
evolving space. Um, I think the
00:19:26.240 --> 00:19:28.390
conversation that probably more more so
00:19:28.400 --> 00:19:30.710
we're being asked about is
00:19:30.720 --> 00:19:33.590
um, what's the office of AI or data look
00:19:33.600 --> 00:19:35.110
like in the future? It's kind of similar
00:19:35.120 --> 00:19:36.870
to what was the chief customer
00:19:36.880 --> 00:19:38.470
experience officer, you know, 10 years
00:19:38.480 --> 00:19:40.789
ago. Everybody seemed to change the org
00:19:40.799 --> 00:19:42.870
dynamics related to that. Now it's more
00:19:42.880 --> 00:19:47.430
so um, how do I think about my AI
00:19:47.440 --> 00:19:49.669
engineering and do I centralize it? Do I
00:19:49.679 --> 00:19:51.430
decentralize it? How do I get the
00:19:51.440 --> 00:19:54.150
benefits for a carrier that has multiple
00:19:54.160 --> 00:19:55.830
business lines, multiple business units?
00:19:55.840 --> 00:19:58.549
How do I how do I get scale on my
00:19:58.559 --> 00:20:00.630
patterns? Do I centralize and then
00:20:00.640 --> 00:20:02.390
deploy it in a federated model? Do I
00:20:02.400 --> 00:20:03.830
have them in every business unit and I
00:20:03.840 --> 00:20:06.630
have a small team? Um, that kind of
00:20:06.640 --> 00:20:09.350
concept is is that's there's a lot of
00:20:09.360 --> 00:20:10.630
there's a lot of time being spent on
00:20:10.640 --> 00:20:12.390
that. And I think the the agent
00:20:12.400 --> 00:20:14.150
conversation and like are the employees
00:20:14.160 --> 00:20:16.070
that's I think that's an ever evolving
00:20:16.080 --> 00:20:19.029
kind of concept. So uh I haven't seen a
00:20:19.039 --> 00:20:20.549
consistent pattern of how people think
00:20:20.559 --> 00:20:22.710
about that yet.
00:20:22.720 --> 00:20:25.110
>> So you know obviously you provide
00:20:25.120 --> 00:20:28.149
consulting services. I think you also
00:20:28.159 --> 00:20:29.990
identify technology partners that you
00:20:30.000 --> 00:20:32.149
think bring strong value potentially to
00:20:32.159 --> 00:20:34.390
different insurance clients that you
00:20:34.400 --> 00:20:37.830
have. So what about sort of the whole
00:20:37.840 --> 00:20:41.990
you know build by partner discussion and
00:20:42.000 --> 00:20:44.950
you know has that equation changed at
00:20:44.960 --> 00:20:46.950
all or that decision-m process changed
00:20:46.960 --> 00:20:48.950
at all?
00:20:48.960 --> 00:20:52.149
>> Uh yeah um there's different definitely
00:20:52.159 --> 00:20:54.549
different schools of thought.
00:20:54.559 --> 00:20:56.630
My my opinion is that I think we're
00:20:56.640 --> 00:20:58.789
entering an age or in an age where
00:20:58.799 --> 00:21:01.669
custom build is more in vogue than it
00:21:01.679 --> 00:21:03.750
was a decade or two ago. I think we
00:21:03.760 --> 00:21:07.669
really moved to buying things versus
00:21:07.679 --> 00:21:11.029
building things. And I think uh AI is
00:21:11.039 --> 00:21:13.190
almost leveling the playing field that
00:21:13.200 --> 00:21:15.190
it's it's
00:21:15.200 --> 00:21:17.669
um and most clients pick one of the you
00:21:17.679 --> 00:21:20.310
know one of the hyperscalers a frontier
00:21:20.320 --> 00:21:22.549
model etc.
00:21:22.559 --> 00:21:24.390
Um, so I think it's going to be
00:21:24.400 --> 00:21:25.990
interesting to watch to see kind of like
00:21:26.000 --> 00:21:29.909
the insure techs and um, how like what
00:21:29.919 --> 00:21:31.909
will the what will that field look like
00:21:31.919 --> 00:21:35.110
when um, carriers actually start to
00:21:35.120 --> 00:21:37.510
scale some of these solutions up and and
00:21:37.520 --> 00:21:39.590
is it a custom dev game versus a buy
00:21:39.600 --> 00:21:41.669
game? I my opinion is that I think we're
00:21:41.679 --> 00:21:43.190
going to see a lot more custom dev
00:21:43.200 --> 00:21:45.270
building going on and whether that's
00:21:45.280 --> 00:21:46.549
done inside the carrier whether they're
00:21:46.559 --> 00:21:48.630
using partners to do it uh it'll be
00:21:48.640 --> 00:21:50.070
interesting to see but I think it's
00:21:50.080 --> 00:21:51.350
leveling the playing field a little bit
00:21:51.360 --> 00:21:53.350
that you can deploy you can build and
00:21:53.360 --> 00:21:54.950
deploy I think and again I think
00:21:54.960 --> 00:21:57.029
hardening is becoming the harder skill
00:21:57.039 --> 00:21:59.029
set now too so it's it's pretty easy to
00:21:59.039 --> 00:22:01.669
build things in a pilot environment
00:22:01.679 --> 00:22:03.510
what's much harder is to actually get it
00:22:03.520 --> 00:22:06.149
into a production contain the token
00:22:06.159 --> 00:22:08.710
usage and hardening the solution so that
00:22:08.720 --> 00:22:10.710
you they're auditable and you're
00:22:10.720 --> 00:22:12.149
managing all the risk. That's a kind of
00:22:12.159 --> 00:22:13.830
a new evolving skill set that I think
00:22:13.840 --> 00:22:14.950
becomes more important. That's much
00:22:14.960 --> 00:22:17.750
different than kind of an app dev um and
00:22:17.760 --> 00:22:19.190
kind of release management skill set.
00:22:19.200 --> 00:22:22.549
So, it's ever evolving. Um but I do
00:22:22.559 --> 00:22:23.830
think we'll see much more custom
00:22:23.840 --> 00:22:25.669
development kind of done with like the
00:22:25.679 --> 00:22:28.310
hyperscalers and model model frontier
00:22:28.320 --> 00:22:29.430
companies.
00:22:29.440 --> 00:22:31.029
>> What what about the working
00:22:31.039 --> 00:22:33.029
relationships within the seauite? you
00:22:33.039 --> 00:22:35.350
know for a long time there was a big you
00:22:35.360 --> 00:22:38.950
know COO playbook which was to offshore
00:22:38.960 --> 00:22:44.149
um things and uh outsource things and um
00:22:44.159 --> 00:22:46.549
you know you've you've got chief AI
00:22:46.559 --> 00:22:48.789
officers or chief data and a officers
00:22:48.799 --> 00:22:50.950
now obviously you've got CIOS some of
00:22:50.960 --> 00:22:54.230
which may may control uh or have
00:22:54.240 --> 00:22:57.110
responsibility for the AI
00:22:57.120 --> 00:22:59.270
>> conversation so how are you seeing like
00:22:59.280 --> 00:23:01.270
the working relationships do you see the
00:23:01.280 --> 00:23:02.870
profiles
00:23:02.880 --> 00:23:05.750
of of of these different personas in the
00:23:05.760 --> 00:23:09.669
seauite changing at all.
00:23:09.679 --> 00:23:11.830
>> Uh yeah, I think so. I think I think
00:23:11.840 --> 00:23:13.990
everybody's becoming much more t
00:23:14.000 --> 00:23:16.710
technowledgeable. Um
00:23:16.720 --> 00:23:17.830
I thought you were going to go down the
00:23:17.840 --> 00:23:19.510
question of like the outsourcing game
00:23:19.520 --> 00:23:20.950
versus the automation game. I think
00:23:20.960 --> 00:23:23.430
that's a big topic too. I think
00:23:23.440 --> 00:23:25.590
>> well I think yeah it was sorry I should
00:23:25.600 --> 00:23:28.070
have phrased I mean another way to
00:23:28.080 --> 00:23:30.149
phrase it is the power of the CIO or the
00:23:30.159 --> 00:23:32.710
chief data and AI officer. ing over the
00:23:32.720 --> 00:23:35.990
COO because of yeah theation versus the
00:23:36.000 --> 00:23:36.470
offshore.
00:23:36.480 --> 00:23:38.149
>> It's a big debate. It's a huge debate
00:23:38.159 --> 00:23:39.909
and you're kind of picking on some
00:23:39.919 --> 00:23:41.270
grenade questions here, but like that's
00:23:41.280 --> 00:23:44.230
a big debate about um yeah, what's the
00:23:44.240 --> 00:23:46.070
future of outsourcing um from a business
00:23:46.080 --> 00:23:48.789
process standpoint? Um I I've seen all
00:23:48.799 --> 00:23:50.870
sorts of different things uh including
00:23:50.880 --> 00:23:53.270
this week. Some some are kind of picking
00:23:53.280 --> 00:23:54.870
a partner to outsource and expecting the
00:23:54.880 --> 00:23:56.149
outsourcing partner to automate
00:23:56.159 --> 00:23:58.149
everything with AI. Some are saying I
00:23:58.159 --> 00:23:59.350
don't need to do that because I could do
00:23:59.360 --> 00:24:01.430
that myself and thus maybe I'll bring
00:24:01.440 --> 00:24:03.510
stuff back into my and I'll control the
00:24:03.520 --> 00:24:05.510
automation that I do. So that is an
00:24:05.520 --> 00:24:07.029
interesting spectrum to watch in the
00:24:07.039 --> 00:24:09.830
upcoming years. I uh I certainly have an
00:24:09.840 --> 00:24:12.230
opinion on it, but um and I think that
00:24:12.240 --> 00:24:15.430
does I I've always been a big fan that
00:24:15.440 --> 00:24:17.110
the the operating officer and the
00:24:17.120 --> 00:24:19.990
information officer, the tech officer,
00:24:20.000 --> 00:24:21.909
they should be extremely tightly
00:24:21.919 --> 00:24:24.549
connected. And the more that companies
00:24:24.559 --> 00:24:26.230
can get, you know, those skill sets in
00:24:26.240 --> 00:24:28.470
the same human is is even better. But
00:24:28.480 --> 00:24:31.510
like um I you know I've been a fan of
00:24:31.520 --> 00:24:33.430
you know for 20 years that the tighter
00:24:33.440 --> 00:24:35.029
that you get the business and
00:24:35.039 --> 00:24:37.830
operations. So so your true P&Ls versus
00:24:37.840 --> 00:24:39.590
your operations and then your technology
00:24:39.600 --> 00:24:41.190
this the more you can get those tightly
00:24:41.200 --> 00:24:42.630
connected the more successful you're
00:24:42.640 --> 00:24:44.870
going to be. There's no question. Um you
00:24:44.880 --> 00:24:45.909
don't want to live in a world where
00:24:45.919 --> 00:24:47.430
there's a chasm of that. You don't have
00:24:47.440 --> 00:24:49.990
an agreeing like an agreement and a of
00:24:50.000 --> 00:24:52.070
opinion on what's the future of what
00:24:52.080 --> 00:24:53.430
that's going to look like and how do I
00:24:53.440 --> 00:24:54.789
service my customers? How do I operate
00:24:54.799 --> 00:24:56.310
the business? I you have to have
00:24:56.320 --> 00:24:59.029
technology at the table constantly and
00:24:59.039 --> 00:25:01.830
whether that's an AI officer or a CTO or
00:25:01.840 --> 00:25:03.430
a PIO, every company's a little bit
00:25:03.440 --> 00:25:08.070
different, but has to be in my opinion.
00:25:08.080 --> 00:25:11.190
>> I'm guessing somewhere in your client
00:25:11.200 --> 00:25:13.029
portfolio, you've got a tier one or a
00:25:13.039 --> 00:25:15.029
tier 2 carrier that's in the middle of a
00:25:15.039 --> 00:25:17.990
five-year core system implementation
00:25:18.000 --> 00:25:19.750
and seeing, you know, some of these
00:25:19.760 --> 00:25:23.029
newer technologies evolve. like do you
00:25:23.039 --> 00:25:24.710
just stay the course with something like
00:25:24.720 --> 00:25:26.870
that or how how
00:25:26.880 --> 00:25:29.510
>> h how how do you approach that?
00:25:29.520 --> 00:25:31.590
>> Uh we have plenty of those. Uh I'm not
00:25:31.600 --> 00:25:34.070
sure five years. Um but yeah, they all
00:25:34.080 --> 00:25:34.870
vary.
00:25:34.880 --> 00:25:36.390
>> They're getting faster. The good news is
00:25:36.400 --> 00:25:37.430
they're getting faster and they're
00:25:37.440 --> 00:25:39.750
getting less risky in my op in in our
00:25:39.760 --> 00:25:43.909
view. Um much because we're in we're
00:25:43.919 --> 00:25:46.630
introducing AI what we call P, you know,
00:25:46.640 --> 00:25:50.789
SDLC or PDLC. Um we're infusing AI from
00:25:50.799 --> 00:25:51.909
a delivery standpoint. So, we're
00:25:51.919 --> 00:25:53.190
speeding up the product owner, all the
00:25:53.200 --> 00:25:55.190
roles. Um, we have quite a few clients
00:25:55.200 --> 00:25:57.029
that are asking us to help them kind of
00:25:57.039 --> 00:25:59.269
help them figure out how to deliver
00:25:59.279 --> 00:26:00.390
faster.
00:26:00.400 --> 00:26:03.590
>> That's good news. Uh, I I'm still a
00:26:03.600 --> 00:26:05.990
believer, incredible like definitive
00:26:06.000 --> 00:26:07.669
believer that you need a you need a
00:26:07.679 --> 00:26:09.990
modern core in insurance. It is our
00:26:10.000 --> 00:26:12.149
equivalent of ERPs and as as we interact
00:26:12.159 --> 00:26:14.470
at P2BC with a lot of other sectors the
00:26:14.480 --> 00:26:16.549
the ERPs or the supply chain systems are
00:26:16.559 --> 00:26:18.070
kind of their cores but for us it's the
00:26:18.080 --> 00:26:19.590
policy admin systems that are the cores
00:26:19.600 --> 00:26:21.909
the policy billing claims u you need a
00:26:21.919 --> 00:26:23.510
modern core as much as you can you have
00:26:23.520 --> 00:26:25.029
to interact with the outside world if
00:26:25.039 --> 00:26:27.110
you're still you you said for the second
00:26:27.120 --> 00:26:29.669
time I've heard for this week um but if
00:26:29.679 --> 00:26:31.110
you're living in an assembler or cobalt
00:26:31.120 --> 00:26:33.750
world it is harder to be connecting to
00:26:33.760 --> 00:26:35.269
the outside world than it is to somebody
00:26:35.279 --> 00:26:37.350
who's fully got a modern data model with
00:26:37.360 --> 00:26:39.269
full APIs
00:26:39.279 --> 00:26:41.029
uh and so forth. You can get around some
00:26:41.039 --> 00:26:43.909
of that now with AI, but like you need a
00:26:43.919 --> 00:26:45.590
core. You need an audible core that has
00:26:45.600 --> 00:26:46.870
all your products, that has your
00:26:46.880 --> 00:26:48.870
proprietary rules, all your action world
00:26:48.880 --> 00:26:50.789
tables. You have to have a claim system
00:26:50.799 --> 00:26:53.269
that's trackable and auditable. Um I
00:26:53.279 --> 00:26:55.029
think just we're in kind of an evolving
00:26:55.039 --> 00:26:57.669
world where I think we'll see more build
00:26:57.679 --> 00:26:59.590
as like a surround on top of it. I think
00:26:59.600 --> 00:27:01.029
we'll see more differentiation on the
00:27:01.039 --> 00:27:02.310
top where you'll actually see some more
00:27:02.320 --> 00:27:05.430
agentic AI layers on top. So my advice
00:27:05.440 --> 00:27:07.669
is yes definitely if you haven't done it
00:27:07.679 --> 00:27:09.350
I think you should and if you're in it
00:27:09.360 --> 00:27:14.149
finish it um but also adopt AI from SDLC
00:27:14.159 --> 00:27:16.070
perspective to actually deliver the
00:27:16.080 --> 00:27:19.029
project. You can you can get great
00:27:19.039 --> 00:27:20.870
acceleration by doing some more modern
00:27:20.880 --> 00:27:23.110
techniques there.
00:27:23.120 --> 00:27:25.190
So I think I'd be remiss if I didn't ask
00:27:25.200 --> 00:27:28.470
about governance and sort of the NIC
00:27:28.480 --> 00:27:32.390
model bulletin and um you know how how
00:27:32.400 --> 00:27:36.470
do you see companies you know either
00:27:36.480 --> 00:27:38.230
leaning into their existing governance
00:27:38.240 --> 00:27:44.710
processes or practices excuse me or or
00:27:44.720 --> 00:27:47.190
>> um it's absolutely of utmost importance.
00:27:47.200 --> 00:27:48.870
You have to you have to get it. That was
00:27:48.880 --> 00:27:51.110
actually I'd say in 23 24 it was
00:27:51.120 --> 00:27:53.110
actually probably more of the we kind of
00:27:53.120 --> 00:27:55.029
went from a pilot then it came went back
00:27:55.039 --> 00:27:56.470
to governance and making sure that we're
00:27:56.480 --> 00:27:58.870
protecting and being resilient and uh
00:27:58.880 --> 00:28:00.789
it's a huge topic AI governance there's
00:28:00.799 --> 00:28:02.950
no question um it's probably the one
00:28:02.960 --> 00:28:04.789
thing that's slowing I think to the
00:28:04.799 --> 00:28:07.510
scale perspective uh it clients are
00:28:07.520 --> 00:28:08.870
nervous if they haven't solved for that
00:28:08.880 --> 00:28:10.230
so you have to get on top of that you
00:28:10.240 --> 00:28:12.230
have to know what's in your environment
00:28:12.240 --> 00:28:14.070
how are people using it you have to have
00:28:14.080 --> 00:28:16.789
a process you have to have continued
00:28:16.799 --> 00:28:18.549
process as people evolve these things.
00:28:18.559 --> 00:28:21.590
We can't just be throwing tools at the
00:28:21.600 --> 00:28:23.669
employee base to do different things. Um
00:28:23.679 --> 00:28:26.070
so it absolutely of utmost importance.
00:28:26.080 --> 00:28:27.909
Um the regulatory bodies are spending a
00:28:27.919 --> 00:28:29.110
lot of time. I've been in meetings with
00:28:29.120 --> 00:28:31.350
them. They're they're talking about it.
00:28:31.360 --> 00:28:34.549
Um but you have to you have to protect.
00:28:34.559 --> 00:28:35.830
There's no question. You have to manage
00:28:35.840 --> 00:28:39.430
that risk. We are insurance companies.
00:28:39.440 --> 00:28:42.549
>> Uh last question. Um, unless you've got
00:28:42.559 --> 00:28:44.149
anything else that we missed that you'd
00:28:44.159 --> 00:28:46.389
like to hit on, but looking three years
00:28:46.399 --> 00:28:48.389
out, you know, what does a carrier that
00:28:48.399 --> 00:28:50.230
got this right look like from the
00:28:50.240 --> 00:28:52.630
outside? What would a, you know, a
00:28:52.640 --> 00:28:54.789
customer or an agent experience
00:28:54.799 --> 00:28:57.590
differently?
00:28:57.600 --> 00:28:59.430
>> Uh, I I think we've been talking about
00:28:59.440 --> 00:29:01.990
this. I I think the insurance company of
00:29:02.000 --> 00:29:04.630
the future that looks like the other
00:29:04.640 --> 00:29:06.470
retail companies that we deal with every
00:29:06.480 --> 00:29:08.789
day, that's that's the one that I think
00:29:08.799 --> 00:29:10.310
everybody's going to talk about. So any
00:29:10.320 --> 00:29:12.950
somebody that can interact with their
00:29:12.960 --> 00:29:15.110
customer base exactly the way they want
00:29:15.120 --> 00:29:16.710
to, when they want to, and how they want
00:29:16.720 --> 00:29:18.870
to. They can talk to humans when they
00:29:18.880 --> 00:29:20.070
need to, but if they want to act
00:29:20.080 --> 00:29:22.870
interact 100% digitally, I I that's
00:29:22.880 --> 00:29:24.549
where I think we're going. I think AI
00:29:24.559 --> 00:29:27.430
can enable a lot of that. So I think
00:29:27.440 --> 00:29:29.269
we've been aspiring to do that for 10 or
00:29:29.279 --> 00:29:30.710
20 years as long as I've been trying to
00:29:30.720 --> 00:29:32.789
help our client base. But as soon as you
00:29:32.799 --> 00:29:34.870
can make your your data accessible, your
00:29:34.880 --> 00:29:37.510
experience is rich and feel like the
00:29:37.520 --> 00:29:39.909
rest of customers interaction. Everybody
00:29:39.919 --> 00:29:42.789
owns insurance products and for the most
00:29:42.799 --> 00:29:45.029
part they want to interact like they do
00:29:45.039 --> 00:29:46.630
with all of the the other well-known
00:29:46.640 --> 00:29:49.029
brands in the world. So whoever can do
00:29:49.039 --> 00:29:51.590
that the best and fastest I think um
00:29:51.600 --> 00:29:54.149
could win.
00:29:54.159 --> 00:29:58.710
>> Great. So, one other one that I I know
00:29:58.720 --> 00:30:01.590
is new and fast evolving is WebMCP and
00:30:01.600 --> 00:30:03.350
the new agents like Muse and all those
00:30:03.360 --> 00:30:05.510
things. I don't know if today is the
00:30:05.520 --> 00:30:07.590
right time for that conversation, Jim,
00:30:07.600 --> 00:30:09.830
but um you know, really appreciate
00:30:09.840 --> 00:30:11.510
having you on. Is there anything else we
00:30:11.520 --> 00:30:13.029
didn't cover that you'd like to touch on
00:30:13.039 --> 00:30:14.389
before we wrap up?
00:30:14.399 --> 00:30:17.190
>> No, good set of questions, Josh.
00:30:17.200 --> 00:30:19.029
>> All right, so Jim Quick, insurance
00:30:19.039 --> 00:30:21.669
advisory sector leader at PWC. Thanks
00:30:21.679 --> 00:30:23.750
for joining me so much on the Insure
00:30:23.760 --> 00:30:27.360
Tech Leadership Podcast.