Why Aflac’s CIO won’t ever be first to market with generative AI—but is still finding ways to adopt the technology

At least, not yet. 

“Alfac is taking a more conservative approach,” says Shelia Anderson, chief information officer at the insurance company that’s best known for selling supplemental policies to cover health events ranging from cancer to life insurance. “Our goal is to never be first to market.”

To kick off its generative AI journey, Aflac developed guardrails and policies to ensure all applications of the technology would follow specific rules. The company also set up a steering committee to assess potential use cases and match them to business objectives.

Anderson says Aflac also spent a considerable amount of time educating the C-suite, board, and the broader employee base on what generative AI is and how it can be be used to support the company’s business goals. That work is still ongoing, with Aflac currently in the process of developing a curriculum that covers technologies ranging from AI to cloud computing.

With the right structure now in place, Aflac anticipates that it will have external use cases of generative AI ready in 2025. It’s exploring a number of those concepts today in the company’s Hatch Innovation Lab, which is based at Aflac’s corporate office in Georgia, and consists of researchers, user experience designers, and tech specialists from different fields that explore emerging technologies.

Some areas of focus include agent recommendations, fraud detection, and churn predictions—the latter would help Aflac identify the customers that have the highest propensity to seek an insurance policy elsewhere. Armed with that insight, Aflac’s sales team could take steps proactively to retain those clients.

The largest and most impactful AI model in place today at Aflac helps auto adjudicate simpler claims, giving customer service agents more time to focus on complex cases. A human will always remain in the loop and approve final submissions for “any type of denial or anything that would be kind of an adverse reaction,” says Anderson.

Aflac is exploring AI copilots and generative AI tools from existing partners like Amazon Web Services and Salesforce, as well as working with specialized, insurance-focused AI startups. The company is also exploring more niche products in the innovation lab, though Anderson says she’s wary of how much she’ll invest in customized solutions. She also keeps tight controls on Aflac’s data.

“Most of the AI models that we have, we will be leveraging data safely inside the walls of Aflac,” says Anderson.

Anderson has worked in the insurance industry for over a decade, serving as a CIO at Liberty Mutual and USAA prior to joining Aflac in 2022. Beyond generative AI, what’s kept her busy is the integration of acquisitions and making customer-facing processes more consistent as it relates to information about policies, claims, and billing.

Anderson also slowed down Aflac’s “rapid” cloud migration. She has led an effort to upskill the company’s workforce so that Aflac could be more knowledgeable about when to lean on cloud and exactly where and how it can save money.

“It can actually end up costing you more if not well managed,” warns Anderson.

John Kell

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NEWS PACKETS

Newsom vetoes state’s AI safety bill. Gov. Gavin Newsom vetoed California’s AI bill, which would be the first state regulation that would have required safety testing of large AI models before their release to the public. Newsom said that the bill was flawed because it applied stringent standards to basic functions and focused too much on regulating AI systems, without considering potential risks and harms from the technology. The governor encouraged legislators to rewrite it for the next session. OpenAI, Google, Meta, and Microsoft were among the tech giants that had opposed the legislation, saying it could restrict innovation.

Verizon mobile users stung by outage. Verizon’s engineers were able to fully restore service after a massive outage on Monday left an estimated 100,000 customers without cell phone service in cities including New York, Los Angeles, and Chicago. The wireless network operator hasn’t disclosed what caused the issue, and that’s fairly standard if networks go down for a few hours at a time. Still, customers weren’t exactly thrilled. CBS News reported that some Verizon customers were upset that the outage made it impossible to use their phones to make business calls, reschedule appointments, or even use 2-factor authentication, which is when a code is sent through a text to a customer phone as a security precaution.

OpenAI’s CTO steps down. Mira Murati, one of the most prominent female executives in the AI industry, announced her resignation as CTO of OpenAI last week, without sharing any details of where she is heading next. Murati had worked at the company for over six years and served as interim CEO briefly after CEO Sam Altman was briefly ousted in a boardroom coup last year, before quickly being reinstated. Her departure comes amid a turbulent year at the startup, as Altman has signaled OpenAI may change the startup’s complex non-profit corporate structure to a more traditional for-profit company. Meanwhile, this week The Information reported SoftBank’s Vision Fund plans to invest $500 million in OpenAI’s latest funding round.

China steers local firms away from Nvidia. Bloomberg has reported that Beijing has increased pressure on domestic companies to buy locally produced AI chips instead of Nvidia’s products, a move that would help Chinese AI chipmakers gain market share while also giving companies more wiggle room if more U.S. restrictions were to be imposed. Already, the U.S. government bans Nvidia from selling its most advanced AI processors to Chinese customers. In related news, Reuters a few days later reported that TikTok’s parent ByteDance plans to develop an AI model with fellow China-based company Huawei Technologies.

ADOPTION CURVE

Gen AI driving cloud budget increases. A survey of more than 1,000 business and tech executives by accounting giant PwC that deemed 12% of those surveyed as “top performers” found that those outliers were more than twice as likely to have developed generative AI-based products and services, implemented responsible AI, and adopted an AI-specific operating model compared to the other companies. Among the larger group of “non-top performers,” PwC says most report plans to implement such AI initiatives within the next year, but up to 20% are still two to three years out. 

The report—conducted in June and July—also found that a vast majority of companies say their cloud tech budgets are increasing at a pace that’s significantly higher than the rate of inflation. For 63% of the top performers, that budget increase is being driven by generative AI, versus 45% for other companies surveyed.

JOBS RADAR

Hiring:

– See’s Candies is seeking a CIO, based in San Francisco. Posted salary range: $312K-$350K/year.

– The House of Representatives is seeking a CIO, based in Washington, for the Office of the Sergeant at Arms. Posted salary range: $190.6K-$201.8K/year.

– Bill & Melinda Gates Medical Research Institute is seeking a head of IT, based in Cambridge, Massachusetts. Posted salary range: $320K-$380K/year.

Hired: