What should MGAs know about applying AI technology?

For managing a successful general agency (MGA) that brings specialty insurance products to market, speed and customer experience are critical to success. However, these are typically lean operations, so both must often be achieved with limited resources.

One expert said: Insurance business Leveraging artificial intelligence-powered technology has proven more important than ever for MGA to remain competitive in a rapidly changing business environment.

“In our industry, speed to market is everything,” said Michael Parcelli (pictured), senior vice president and head of MGA business at Xceedance. “The ability to bring new products and services to market quickly gives us a competitive advantage.”

Traditional insurance product development cycles can be long, involving manual processes and extensive paperwork.

However, artificial intelligence technology is rapidly transforming this side of the business, allowing MGA to speed up and automate underwriting and claims processes, enhance pricing models, and offer on-demand services through online customer portals. will be able to provide you with.

“AI allows us to automate many of these processes, significantly reducing the time it takes to develop and launch new products,” Parcelli said.

MGA faces hurdles in implementing AI-powered technology

Like other insurance companies, MGA faces unique hurdles in implementing AI technology across its operations. According to Parcelli, the biggest limitations MGA faces in applying AI are limited knowledge and resource constraints.

Parcelli explained: “MGAs typically run very lean and functional staffs. They're not large organizations, they're more like a combination of a brokerage and an insurance company, so they don't have enough staff to do what they need to do. We have personnel.

“These technologies are difficult to implement because there aren't many departments or resources to test, monitor, or proof-of-concept AI. Realizing their value will require companies with market knowledge and professional services to do so.” You have to depend on it.”

However, the benefits of prioritizing investments in AI are significant. Parcelli said MGA should divide its efforts into three key areas: increasing speed to market, improving operational efficiency and improving customer service.

How generative AI can accelerate MGA’s speed to market and customer service

One of the ways AI accelerates time to market is through data analytics. Leveraging machine learning algorithms, MGA can analyze vast amounts of real-time data to identify market trends and customer preferences. This will allow MGAs to reduce the time it takes to underwrite insurance policies while adjusting their offerings accordingly.

Parcelli noted that the introduction of generative AI, in particular, is accelerating MGA's timetable for first-to-market for innovative products.

“Window of Opportunity” [to introduce a new product] It's important to address competitors before they start eating into your market share. That’s where AI, especially generative AI, comes into play,” he said.

“Deploying products into a policy management system, similar to how insurance companies have historically deployed products, is a time-consuming process that requires significant effort and resources. , we can streamline this process by helping you code your system and accelerate your market release schedule.”

By optimizing AI, MGA can significantly increase productivity and process applications, claims, and underwriting faster with fewer people.

On the customer service front, AI chatbots are a powerful tool to improve the insurance experience for consumers who increasingly expect seamless interactions with their insurance providers.

“By using chatbots, we can provide instant support to customers, answer questions, and guide them through the insurance process,” Parcelli said.

What should MGAs know about implementing AI?

AI technology has great potential for MGA. However, Parcelli cautioned that implementation requires careful planning and strategic execution.

“Integration with existing systems, data privacy concerns and staff training are all factors that need to be considered,” he said. Insurance business.

His best advice for MGAs: Get the right tool for the right job.

“Timing is critical to gaining market share, so the key is to efficiently integrate products into systems and leverage the right version of AI to accelerate the path to market,” he said. I am. “Differentiation is essential in the highly competitive MGA space where multiple companies offer similar products.”

Parcelli also advocated finding the right balance in AI strategy, avoiding over- or inadequate solutions and maximizing the technology's productivity potential.

“The right tool for the job also means making sure you use it in the most productive way, which means not using a backhoe to plant a garden,” he says.

What are some other benefits of AI technology for MGA to reduce time to market and improve customer service? Share your comments below.