Is SaaS dead?

The software industry is at a tipping point, and Microsoft CEO Satya Nadella is calling it out. Nadella recently suggested that artificial intelligence agents could disrupt traditional SaaS models by automating business logic and decision-making. This shift, he argues, will replace static workflows with a dynamic, AI-powered layer that adapts to real-time needs. For property and casualty (P&C) insurers, the implications are profound: the technology investments of today may soon require a complete reimagining.

Over the past decade, P&C carriers have poured resources into SaaS-based platforms to improve underwriting, claims processing and risk management. These platforms have boosted efficiency and simplified workflows. However, Nadella's vision of "agentic workflows" suggests a significant shift. Unlike traditional SaaS systems, agentic workflows use AI agents to analyze data, make decisions, and execute tasks autonomously in real time. This change could enable insurers to move away from rigid processes and adopt more flexible, intelligent operations.

Take underwriting as an example — a process typically dominated by manual data entry and analysis. With agentic workflows, AI agents could automatically gather data from internal and external sources, such as property imagery or weather patterns, assess risk, and propose pricing. For instance, an insurer could use an AI agent to analyze aerial imagery of wildfire-prone areas, cross-reference the data with historical claims, and provide an immediate risk score for new policies. This not only speeds up underwriting but also ensures more accurate pricing. 

Similarly, in claims processing, AI agents could review first notice of loss (FNOL) data, detect fraud patterns, and recommend next steps in seconds. Think of it this way: SaaS systems are like static maps, providing fixed routes. Agentic workflows function like GPS, adapting dynamically to roadblocks and guiding users to the best outcome in real-time.

By automating routine tasks like data processing and claims triage, agentic AI frees employees to focus on high-stakes, complex cases that require human expertise. This approach not only enhances productivity but also allows teams to prioritize nuanced decision-making, relationship-building and customer value. 

Preparing for the shift to AI-driven workflows

For P&C insurance executives, the move to AI-driven workflows presents both challenges and opportunities. Here are practical steps to get ready:

1. Build AI-first architectures
Design systems that are modular and API-driven, allowing seamless integration with AI agents. This approach makes applications flexible and ready for future innovations without the need for costly overhauls.
2. Unlock the power of your data
Agentic AI enables carriers to leverage modular data by seamlessly retrieving information from disparate databases across the enterprise. For carriers, the key is to modularize data by ensuring that information is stored in standardized, accessible formats with robust APIs or middleware to facilitate connection. By taking these steps, carriers can unlock the full potential of their existing data infrastructure — transforming scattered data into a strategic advantage.
3. Engage regulators early
AI workflows will succeed only if they meet regulatory standards. Departments of Insurance (DOIs) need to trust AI-driven decision-making processes. By engaging with regulators proactively and communicating clearly, insurers can ensure compliance and help shape future regulations.
4. Pilot agentic workflows
Start small by introducing AI agents in lower-risk areas like fraud detection or claims triage. These pilots provide valuable insights and build confidence in the organization's ability to implement agentic workflows.

The road ahead for insurance

While SaaS platforms have modernized processes, the next wave of innovation demands flexibility, real-time adaptability, and smarter operations. By taking steps to modularize data, pilot AI-driven workflows, and proactively engage with regulators, insurers can unlock new levels of efficiency and precision. Those who adapt swiftly will not only optimize their operations but also establish themselves as leaders in resilience and customer-focused innovation.