Customers are increasingly using AI to examine wordings and pose questions to brokers, and intermediaries say it is adding significant delay in critical areas.

“AI adoption, which the insurance industry has spent two years installing as a productivity aid, has turned up on the other side of the table,” co-founder of Upcover Anish Sinha said.

“The customer is now about using these tools in this continued soft insurance market to analyse their insurance solution.”

But the computer isn’t always right, and the sheer volume of AI-produced material that brokers have to sift through is causing concern.

“The client’s new superpower is coming back to us and questioning our advice and our judgment,” East West Group chief insurance officer Rebecca Sawers told insuranceNEWS.com.au.

“It’s actually holding up outcomes for the client when they’re coming back with their ‘expert advice’ and it’s just not accurate.

“They could be asking questions that just are not even relevant. It takes time for us to break that down and try and articulate back to them. I think it’s doing more harm than good at the moment.”

CEO of Envest Broking Ben Goodall says brokers can use AI much more effectively than clients – because they’ve trained it over time.

“AI can be bullied, and it can hallucinate, and it can also just be inaccurate if it’s not often interacting with you,” he said. “A client once a year throwing its insurance program in and saying ‘tell me more’ won’t get a great outcome from AI. It just won’t.

“Occasionally, a good question pops up, but what we we’re being provided with – to date, anyway – is a little bit of slop.”

Mr Sinha says brokers must expect to deal with incorrect AI assertions – and the critical issue is how they respond.

“A broker who can explain exactly why the machine is wrong will earn more trust in that one exchange than in three quiet renewals,” he said.

“The client turning up with questions is not the threat. Rather, having nothing useful to say when they do is. The industry needs to be ready to politely correct this in a human way that doesn’t embarrass the client.

“That’s where human intervention in the policy process can well and truly shine.”