AI use surges at Travelers as call center roles reduce
AI technology and innovation driving growth
Travelers’ net profit has increased, according to Schnitzel, largely fueled by the company’s intensive technology and innovation strategy. Travelers reportedly increased its total value of insurance policies it sold by nearly 7% a year on average between 2016 and 2025. Its underlying combined ratio improved by almost eight points, falling to 83.9.
Schnitzel explained that heavy investment in technology has coincided with improved profits. “Notwithstanding a increase in our technology spending, that improvement in underlying profitability includes a 3-point or 10% improvement in our expense ratio. Over the decade, we developed the competitive advantage of an innovation skill set. Now we’re bringing all that Part 1 know-how to Innovation 2.0 at Travelers, powered by AI – and not too far off quantum computing.”
Innovation 1.0 relates to the company’s strategy and foundation to this success, and it has plans to move into a more advanced stage it’s calling Innovation 2.0, in which AI is the central driver.
Automation equals call center culls
Schnitzer noted how automation has directly reduced staffing needs and improved claims efficiency, something clearly seen in recent numbers. For instance, Schnitzel said that Travelers’ “claim call center population is down by a third,” and steps are being taken to consolidate four claims call centers into two.
Such efficiency gains have reduced loss adjustment expenses, improving the company’s loss ratio. Ultimately, investment in automation and analytics have helped Travelers “refine indemnity payouts and drive operational efficiencies.”
Schnitzel stated that over 50% of all claims made to Travelers are now eligible for straight-through processing, and customers are adopting this processing approximately in two-thirds of cases. He went on to say that: “Another 15% of all claims are processed with advanced digital tools. All of those percentages are growing.”
Despite automated tools doing the bulk of claims work, the CEO said that some customers still prefer to call the company to report and discuss claims. Therefore, Travelers has set up an advanced natural language generative AI voice agent that handles initial phone calls.
Schnitzel heralded the success of this voice agent, saying: “Early customer adoption is exceeding our expectation.”
