HDFC Life’s AI Strategy To Deliver ‘Measurable Outcomes’ Across The Insurance Value Chain

As a part of its digital transformation agenda, HDFC Life has made huge investments in technology The Company’s annual report for FY25 reports an increase of about 28 per cent from FY24. “The Higher technology expenses were driven by investments in product testing, application development, cloud-based projects, and deployment of digital assets, supporting ongoing digital transformation,” said the company in the report. Among other IT based programs; the company is also working heavily on a number of initiatives in Artificial Intelligence. 

The Company maintains that while the coexistence of legacy and new systems might lead to a temporary rise in costs, this transition is designed to unlock meaningful efficiencies, elevate customer experience and strengthen the Company’s path forward towards long-term digital leadership. 

HDFC Life has undertaken a comprehensive set of artificial intelligence (AI)–led initiatives across customer service, sales, underwriting and claims management, with measurable outcomes across each area. As per the company’s FY25 annual report, the company’s AI-driven complaints prediction model has achieved T-day case initiation for nearly 90 percent of complaints and escalated requests received. 

In underwriting and claims, HDFC Life has developed an integrated health score engine wherein smart analytical triggers have been implemented to flag and investigate high-risk cases, resulting in a considerable reduction in fraudulent claims. Complementing this, a GenAI-based pre-claims assistant has enhanced efficiencies in terms of handling a higher volume of risk investigation.

FE CIO speaks with Sameer Yogishwar, Chief Operating Officer, HDFC Life who shares the artificial intelligence led transformation strategy of the company.

How have you included the Artificial Intelligence (AI) journey in the company’s digital transformation program ?

We are working on integrating AI across the insurance value chain. This is built on our belief that AI is critical to making our core operations faster, more accurate and customer centric. Keeping this in mind, we are using AI and embedding intelligent technologies in every aspect of business. 

Specifically, we are using AI in customer acquisition to turbo-charge the on-boarding process. It is a massive exercise, because we are not just on-boarding individuals, but also group clients, of which we have more than 500! A quick math on the underlying members that comprise each group client list, read along with the retail client numbers, would give you a sense of the enormity of this task. 

On the servicing side, we are using AI in underwriting, with risk management being key to maintaining the quality of our book. This is an absolute imperative that defines the health of any insurance business. Also, with insurance being a long term product spanning multi-year relationships and involving multiple touch points with the customer, the importance of seamless and accurate servicing cannot be emphasised enough.

Finally, Claims is one of the emerging areas where we are seeing AI make significant impact. It is not just in ease of settling claims, but also in identifying and forestalling potential frauds. To summarise, we are a forward-thinking insurer that uses AI not only to accelerate fair payouts, but also to dynamically triage cases, flag anomalies in real time, and continuously learn from outcomes to make the entire claims process smarter, safer, and more resilient.

What are the major areas covered in the Artificial Intelligence led transformation strategy ?

To stay ahead on customer experience, we have invested in data analytics and innovation labs. This was done to proactively identify early indicators across the value chain. Given the diversity of our customer segments, we remain focused on staying relevant across both physical and digital touch points. In line with this, we are undergoing a technology transformation aimed at building real-time seamless service capabilities, moving us closer to ‘Insta’ service delivery.

Our AI led transformation strategy is aimed towards unlocking growth and efficiencies across the areas of customer engagement, process efficiency, employee empowerment and business expansion. There are core teams focused on each of these domains to maximise the outcome.

In customer engagement, through AI chat bots, we have started integrating personalised communication journeys, thereby enhancing service quality. Our facial recognition tool has improved the customer experience during on-boarding which in turn has enhanced the overall purchase experience.

On the process efficiency side, we now use AI in the pre-claim profiling process and in real time governance dashboards. We have also implemented multiple workflows. As an example, escalation workflows with AI models running at the backend, enable accuracy, resulting in significant reduction in the number of manual interventions.

AI integration has also been done across areas of employee empowerment. Multiple Gen AI solutions have gone live: HR buddy, marketing content generator, complaints predictor, call summarizers, etc. Consequently, we have witnessed major improvements in each of these areas. The selection quality has gone up by 15 percent while escalations have come down by almost 25 percent. Finally, our operational efficiency has seen a lift of 30 percent.

On business expansion, AI-generated customer personas and our real-time guidance platform for frontline teams are enabling sharper prospecting and better-quality engagement. Overall, we have been able to materially strengthen not just our growth engine, but also the cost discipline. 

Underwriting is critical to customer profiling and it’s also a major use case for AI adoption. What’s your strategy to use automation in underwriting ?

Adopting cutting-edge technology gives us an early mover advantage as we prepare for the future. Artificial Intelligence (AI) and advanced analytics have already started to revolutionise risk assessment, enhance underwriting precision and fortify fraud detection mechanisms.

Additionally, digital platforms are likely to play a crucial role in expanding the industry's reach, streamlining policy issuance, and fostering trust through transparent claims settlement processes.

Automated underwriting is considered a normal market practice, but we're doing it differently. The aim is to bring together the contextual intelligence across all our retail and group products, customers, through an integrated automated underwriting desk.