The following article was originally published in Captive International: Cayman Focus 2024. Origami Risk was recognized as “Highly Commended” in the 2023 Captive International Cayman Awards new Technology Products category.  
 
The promise of artificial intelligence (AI) is sparking a modern “gold rush”. Vendors seem to be touting its inclusion in every possible solution, and users are demanding new AI-powered tools to increase their productivity and gain new insights. 

Captives and their members can certainly benefit from the effective introduction of AI. Yet, before either group can leverage this new technology to its full potential, there are foundational challenges that must be overcome. The bad news is that failing to resolve these challenges will likely lead to unsustainable processes and doomed technology programmes. 

The good news is that focusing on the foundational issues can benefit captives and members immediately while also opening the door to the successful use of AI solutions in the future. 

Captive International interviewed Bill Schwacke, a senior sales executive and healthcare practice leader with Origami Risk, a 2023 Cayman Technology Product Firm award-winner, about what healthcare captives and the organisations they serve need to do in order to prepare for the introduction of AI. 

Schwacke is a senior-level, risk management technology professional with extensive experience in sales, account management, product design, and the implementation of risk management information system solutions for the healthcare industry.  

With decades of experience delivering software solutions, Schwacke has a keen understanding of the factors that contribute to the successful adoption of technology and the pitfalls that can derail even the most earnest efforts. 

What are the biggest mistakes captives and their members make when looking at major technology shifts? 

There are two major stumbling blocks. First, no technology is a magic wand—and that includes AI. While AI offers considerable potential in terms of helping captives gain greater insights and increasing the efficiency of members’ management of submission data, it won’t fix an overloaded process or bad data. 

Since AI is fueled by data, any chokepoints or flaws in a member organisation’s submission process will only be made worse by the demands for the information that AI needs to run. Not only will AI fail to serve as a magic wand that removes data management issues, it will pressure-test the current processes and may worsen any existing deficiencies. 

The second issue is that one size never fits all. Based on the risks they cover, captives may rely on complicated, sophisticated administration processes or they may use only a straightforward, lean approach. Similarly, members may have complicated review and approval processes requiring board participation, or they may be able to get by with essentially marking up loss reports. 

Expecting technology—AI or otherwise—to handle that full spectrum of use cases equally well is a very tall order, unless the technology was designed with that kind of flexibility in mind. 

One of Origami Risk’s foundational principles is that configuration is always a better option than the use of custom code. Without the ability to make system changes yourself, an organisation will have to change its procedures to fit the technology. 

Proper expectations and having flexibility designed into any core solution are key elements. What’s next? 

AI runs on data and the same is true for captives. They require large amounts of data in a specific, ingestible format to provide context for all the decisions related to risk that are made every day. The burden of providing that data falls on member organisations. If you improve the data exchange process, both sides benefit and that effort will pave the way for the successful use of AI solutions in the future. 

When the benefits expected to be conjured by using the “magic wand” of AI are defined, often many of the items listed don’t actually require AI. For example, there’s automating parts of the data sanitisation process. Another item that typically comes up is the ability to spot outliers and get early warnings before issues mushroom into much larger problems.  

Often cited is the need to eliminate discrepancies in submission data for greater consistency. AI will certainly turbocharge those types of efforts, but the reality is that other technology solutions are out there and readily available today that can be effectively used to accomplish those goals. 

While these tools may not utilise AI, they provide many of the same benefits one would expect to receive from an AI solution. For healthcare organisations’ risk management departments, deploying solutions that reduce administrative burdens can make a significant and immediate impact.  

Do what you can, right now, to make that process more stable and scalable, because the introduction of AI is only going to raise the bar even higher. 

What’s the next step that can move organizations toward the effective use of AI? 

There is a lot of promise in the application of AI to risk and loss environments—everything from extended process automation to things such as fraud detection and enhanced risk analysis. At Origami Risk, we’re working with several AI partners to develop some pretty exciting new opportunities. But taking a step back, AI resources are likely to flow to areas that offer the biggest potential impacts for users. 

I’ve seen first-hand the price that organisations pay when things such as application upgrades or system changes (which happen frequently) lead to the reporting of inaccurate information. That results in a direct hit to the bottom line.  

If an AI solution could identify and prevent those types of issues, that seems like a solution companies would gladly pay for. The more that AI can be translated into quantifiable benefits, the more likely it will be successful. 

If someone were to attempt to introduce such a solution tomorrow however, the reality is that many organisations wouldn’t be in any condition to fully leverage it. In fact, incorporating AI solutions on a flawed data management system may be opening the organisation to great financial risk. 

Those who solidify their data management programmes now, identify areas where existing technology could move them forward, and choose flexible technology platforms will be ready to ride whatever AI waves eventually come their way. The rest will be left wondering why AI fails to live up to their expectations. 

Learn more about Origami Risk’s healthcare solution suite.