Travelers is stepping up its use of artificial intelligence across the business, pairing advanced technology with human expertise as it adapts to changing demands in the insurance sector. The shift is already delivering measurable gains in efficiency and profitability, even as it reduces the need for some traditional call centre roles.
In mid-January, the US-based insurer announced a new agreement giving around 10,000 engineers and data scientists access to AI assistants. Shortly afterward, company leaders clarified that while AI is a powerful tool, Travelers’ long-term edge comes from combining technology with deep industry knowledge.
According to chief executive officer Alan Schnitzer, more than 20,000 employees now use AI tools regularly. He said automation has helped boost efficiency in claims handling, contributing to a significant reduction in claims call centre staffing.
Technology-led growth shows results
Travelers’ investment in technology and innovation has coincided with stronger financial performance. Schnitzer said the company’s net profit has risen alongside a steady expansion of its insurance business. Between 2016 and 2025, the total value of policies sold grew by nearly 7% a year on average, while the underlying combined ratio improved by almost eight points to 83.9.
Despite increased technology spending, Travelers has reduced its expense ratio by around three points, or 10%, over the decade. Schnitzer described this period as “Innovation 1.0,” where the company built a strong foundation of digital and analytical capabilities. The next phase, “Innovation 2.0,” places AI at the centre of future growth, with quantum computing also on the horizon.
Automation drives call centre consolidation
Automation has had a direct impact on staffing needs, particularly in claims operations. Schnitzer said the claims call centre workforce has fallen by about one-third, with plans underway to consolidate four claims centres into two.
These changes have lowered loss adjustment expenses and improved the loss ratio. More than half of all claims are now eligible for straight-through processing, with customers choosing this option in roughly two-thirds of cases. A further 15% of claims are handled using advanced digital tools, and those figures continue to rise.
For customers who still prefer to speak with someone, Travelers has introduced a generative AI voice agent to manage initial calls. Schnitzer said early adoption of the voice agent has exceeded expectations.
AI use expands across the business
The impact of AI extends well beyond claims handling. Schnitzer said new tools are improving underwriting decisions, streamlining workflows, and enhancing experiences for customers, agents, brokers, and employees.
Greg Toczydlowski, executive vice president and president of business insurance, explained that generative AI agents are being used to analyse large volumes of internal and external data. This helps underwriters better understand risk characteristics, speed up decision-making, and refine pricing strategies.
In personal insurance, executive vice president Michael Klein said AI plays a key role in renewal underwriting. Proprietary predictive models score each account for potential risk, while generative AI summarises relevant data for underwriters. This approach has cut average handling times by about 30%, allowing teams to focus on decisions most likely to improve profitability.
AI is also reshaping specialty insurance. Jeffrey Klenk, president of bond and specialty insurance, said new tools have reduced submission intake times from hours to minutes and are now being used to streamline renewals as well.
Productivity over headcount
While call centre headcounts have already been reduced, Schnitzer avoided predicting further job cuts. Instead, he emphasised productivity gains, noting that output per employee has increased and is expected to continue rising as AI tools mature.
He believes AI will benefit the wider property and casualty insurance industry by handling complex processes and vast amounts of structured and unstructured data. According to Schnitzer, AI does not replace expertise but strengthens it, with dozens of generative AI tools already in live use and millions of transactions now automated.
A measured shift toward an AI-driven future
Travelers’ experience shows how AI and automation can reshape insurance operations when paired with skilled professionals. From faster claims processing to smarter underwriting and improved customer service, the company’s approach highlights both the opportunities and challenges of digital transformation.
As Travelers moves deeper into its “Innovation 2.0” phase, the focus remains on using AI to enhance human decision-making, improve efficiency, and support sustainable growth in a rapidly evolving industry.
