Allstate's AI Email Controversy: Efficiency Boost or Customer Service Misstep?

Insurance giant finds claims rep that gives a damn (it's AI)

It doesn't sleep, it doesn't eat, and it doesn't get sick of dealing with incompetent customers. Even if it's fundamentally strings of ones and zeroes, US insurance biz Allstate is finding that generative AI crafts more empathetic and customer-friendly emails than its human claims reps, though anyone who has had dealings with insurance providers might not be surprised. Allstate has some 23,000 insurance reps sending out around 50,000 communications to claimants every day, gathering information for negotiating settlements and the like. "When these emails used to go out, even though we had standards and so on, they would include a lot of insurance jargon. They weren't very empathetic ... Claims agents would get frustrated, and so it wasn't necessarily great communication," Allstate CIO Zulfi Jeevanjee told The Wall Street Journal. Now nearly every one of those emails is written by AI, specifically OpenAI's GPT models, grounded in Allstate's company-specific lingo. For the time being, the AI works alongside its army of reps. "The claims agent still looks at them just to make sure they're accurate, but they're not writing them anymore," Jeevanjee added. The result has been more polite and less jargon-filled communications - something Allstate's reps likely appreciate, given the repetitive back-and-forth of insurance claims. Allstate said meatbag reps tended to use phrases like "first notice of loss" or refer to "CCC Intelligent Solutions," a vendor the insurance giant employs to estimate repair costs, without explanation. It pointed to an email where a rep doled out the acronym "UPP inventory list," but its AI counterpart helpfully spelled it out: "Unscheduled Personal Property inventory list." Jeevanjee also said that where human reps might question the validity of a claim, Allstate's AI would give customers "the benefit of the doubt." Indeed, the chatbots appear to have an impeccable bedside manner, making empathetic noises like "Thank you for your message. I understand your concern," and "If you have any other questions, feel free to ask" - phrases that may not cross the mind of a tired, grouchy human who is just trying to make it through the day. While human reps at Allstate still have jobs for now, it's early days for AI-driven customer service in the insurance industry. The WSJ cites a survey from the International Customer Management Institute, where 35 percent of respondents said they think AI will reduce hiring requirements, while 38 percent didn't see it as a factor. And insurance's interest in AI doesn't stop at customer service. The sector is looking to employ the tech for risk assessment, policy pricing, and claims review - areas where Allstate is experimenting with AI to analyze photos of vehicle damage. Of course, AI deployment includes its own risks for vendors who use it. For example, litigation, successful or not, is expensive. UnitedHealthcare was sued in 2023 for allegedly using AI to automate healthcare claim denials, raising concerns about the growing role of automation in insurance decisions. The case is still ongoing. Jeevanjee said the goal of the AI implementation is to make Allstate more customer focused. "If I think about the insurance industry in general, we haven't really done a great job of being customer obsessed," he said. "That's really what I'm trying to drive." Allstate's AI rollout appears to be going smoother than that of courier DPD. A year ago, a customer exploited its chatbot's weak guardrails and forced it into spouting self-flagellating Vogon poetry. ®

Allstate Is Demanding That We Delete These Quotes by Its Exec About Using How It's Using AI to Write Insurance Emails

We were struck this week when the Wall Street Journal reported that Allstate, a major insurance company, had largely handed over the task of writing claims emails over to an AI system. The WSJ's source wasn't remotely controversial; it was Allstate's own chief information officer, Zulfi Jeevanjee. "The claim agent still looks at them just to make sure they're accurate, but they're not writing them anymore," Jeevanjee enthused to the newspaper. "When these emails used to go out, even though we had standards and so on, they would include a lot of insurance jargon," he continued. "They weren't very empathetic... Claims agents would get frustrated, and so it wasn't necessarily great communication." It was a fascinating story about the incursion of AI into yet another industry, so we ran a quick blog on it and moved onto other things. But then we got a genuinely bizarre email from someone on Allstate's media relations team, claiming the WSJ's reporting was flawed and that the newspaper was on the verge of taking it down. "I'm currently working with the Wall Street Journal to have it updated/removed due to the high number of inaccuracies," the Allstate spokesperson told us, demanding that we delete our blog entirely. For obvious reasons, that's a ridiculous request. We told the spokesperson that we'd be happy to update the piece with additional comment from Allstate, but that we wouldn't change our factual claims unless the WSJ did. Later on, the WSJ did add a correction to its story -- but only on two obscure points, about the number of insurance reps the company employs and the name of the vendor Allstate uses for estimating the cost of repairs. Meanwhile, Allstate's media team continued to badger us, sending a lengthy table of requested changes, many of which involved deleting or altering statements by the company's own exec, Jeevanjee (they were also very unhappy with a comparison to UnitedHealthcare, another insurer that's reportedly deployed AI to deal with claims.) In fact, they sent this preposterous table laying out exactly which quotes they wanted modified or removed: To be clear, it's not out of the ordinary for spokespeople to reach out to journalists to dispute factual claims, sometimes resulting in corrections. We're all human, after all (or, at least, those of us who aren't writing Allstate's claims emails still are.) But it's an entirely different matter when a company requests that direct quotes by its executives be deleted wholesale. And frankly, we were baffled: Jeevanjee is the company's CIO, so you'd expect that he'd know exactly how its employees were using technology. And his quotes -- the "claim agent still looks at them just to make sure they're accurate, but they're not writing them anymore" -- weren't remotely ambiguous. Flummoxed, we replied to Allstate seeking some clarity. Were they saying that Jeevanjee was lying when he made the remarks to the WSJ? Or that he was confused? Is he now claiming something different? "We would like to correct how our Claims team uses AI tools," the spokesperson replied, completely ignoring our questions. "Allstate employees are responsible for drafting and sending all customer emails, and they can choose to use AI tools to help improve clarity. Our employees are committed to helping restore our customers' lives quickly with accuracy and empathy." Asked again why Allstate was so bluntly contradicting its own CIO, the spokesperson again ignored the question -- in another email, we couldn't help but notice, that sounded a bit like it might have been written with AI itself. "As I mentioned, we would like to correct how our Claims team uses AI tools," they said. "The information I provided you provides an accurate overview of how customer emails are drafted and sent and we are asking you to include that in any reporting on our use of AI." It's hard not to speculate about what's going on behind the scenes at Allstate. Was there a drastic miscommunication? Some sort of coverup of an actual policy? But the most likely explanation probably has to do with this: Allstate is starting to realize, like many other large companies, that customers don't like the idea of being offloaded onto a flawed and over-hyped AI system. And as a result, when a newspaper reported that that's exactly what it had been doing, its media arm panicked -- and started making bizarre demands to journalists.