DeepSeek AI is helping Chinese insurers enhance their operational efficiencies.
According to a new commentary by AM Best, the AI model being used by smaller insurers in China is helping them become more competitive and reduce the technology gap with larger players. Several Chinese insurers have begun implementing DeepSeek in their operations. AM Best’s commentary, expresses optimism about the opportunities and risks presented by AI technology and mentions that the potential impact of DeepSeek on the country’s insurance industry is credit neutral.
The commentary highlights potential negative impacts of DeepSeek on insurers’ Enterprise Risk Management. Insurers that fail to identify risks associated with AI models or fail to construct appropriate risk frameworks may experience negative effects on their business. This is particularly true in relation to regulatory risk, execution risk, and model risk.