The insurance industry is increasingly concentrating its innovative financial services on artificial intelligence (AI). In the past, various attempts were made regarding coverage targets, premium settlements, and claims payment methods. However, recent trends show a focus on AI consultations, operational support, and employee training. Critics argue that this shift towards cost reduction and productivity improvement may be hindering the development of new products and services.
According to the financial sector on October 16, there have been six cases this year where life and non-life insurance companies were designated as innovative financial services by the Financial Services Commission.
Notable examples include Hanwha General Insurance's 'AI Assistant for Design Consultation', Kyobo Life's 'Agentic AI Support Service', Samsung Life's 'AI Human and Generative AI-based Training for Agents and Employees', and DB Insurance's 'Generative AI Chatbot Service for Insurance Operations and Customer Interaction'. These services assist agents in their work and support employee training.
The innovative financial services program grants temporary regulatory exemptions to test new services that are hindered by regulations. Following improvements to the separation of networks regulation, insurance companies have been rapidly applying for AI-related services, leading to a concentration of designations in this area. Last year, all 15 designated innovative financial services in the insurance sector also involved AI-based consultations and product recommendations.
In the past, there were diverse attempts to change coverage targets and insurance usage methods. Around 2020, innovative financial services emerged, including group insurance for businesses with fewer than five employees, post-settlement health insurance, insurance payment services through point platforms, non-face-to-face simple enrollment for corporate insurance, and on-off overseas travel insurance.
These services aimed to lower the barriers for group insurance for small businesses or change the methods for premium settlements and claims payments. In contrast, recent examples primarily involve integrating AI into existing insurance operations, raising concerns about the diminishing diversity of innovative financial services.
Industry insiders explain that automating existing operations is often easier to achieve in terms of return on investment than developing new products and services. New services can be costly to develop, and their actual profitability is uncertain, while operational automation can lead to expected cost savings and productivity improvements.
A financial sector official stated, "Insurance is a labor-intensive business from the sales stage to underwriting," adding that automating procedures to enhance efficiency is more beneficial than developing new services.
Another official noted that new services require significant development costs and may not necessarily lead to actual profits.
Concerns have also been raised about the lack of smooth data utilization necessary for developing consumer-tailored services. Professor Seo Ji-yong from Sangmyung University pointed out that the sharing of customer health information from organizations like the Health Insurance Review and Assessment Service is not well-established, leading insurance companies to be hesitant in participating in MyData projects. He concluded that neglecting personalized information contributes to a conservative approach to participating in innovative financial services.
* This article has been translated by AI.
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