In a recent study conducted by EXL, it has been found that 89% of insurance and banking companies in the UK have adopted artificial intelligence (AI) technologies within the past year. The research, which involved surveying executives from leading UK insurance and banking institutions, revealed that 44% of these firms have integrated AI into over eight different business operations, notably in the areas of marketing, business development, and regulatory compliance.
Financial services leaders have significantly invested in AI, with nearly 90% allocating more than £7.9 million in the technology during their last fiscal year. Over a third of these firms have invested in excess of £39 million, indicating a strong commitment towards AI implementation within the industry.
However, the report suggests that there is a potential challenge in the form of data optimisation that could impact the efficacy of AI applications. Approximately 47% of the surveyed organisations acknowledged that they are only minimally driven by data, which raises concerns about the success of AI implementations without a solid data infrastructure.
Kshitij Jain, EMEA Practice Head at EXL, commented on the findings, noting that while the industry recognises the potential of AI, the rush to adopt the technology might lead to substantial investments without ensuring that operations are adequately data-driven. This oversight could result in significant financial implications.
The study also identified a segment of respondents, termed “Strivers,” who represent 45% of the survey participants. This group has adopted AI in a more targeted manner, applying it to approximately four business functions. This focused approach has led to more efficient use of AI, with these firms outperforming their counterparts by 23 percentage points in terms of cost savings.
Furthermore, the research highlighted that over half of the respondents are increasing their AI investments due to advancements in generative AI. However, there are widespread concerns among these leaders about the potential risks associated with generative AI, including brand damage and the accuracy of data outcomes.
Jain concluded by emphasizing the importance of a strategic approach to AI implementation, including the establishment of a proper data architecture, thorough testing of AI solutions, and adequate training for employees. He stressed that for AI adoption to be successful at the enterprise level, it is crucial for company boards to understand AI’s capabilities and ensure that investments are made judiciously.
The full report is available for those interested, although registration is required to access it.
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