Hugo Serra (Occident): Using AI recklessly can be a disastrous business decision

Hugo Serra, the CEO of Occident, warned that reckless use of artificial intelligence (AI) might prove to be a disastrous business decision. During the XVII EXPANSION-KPMG Financial Meeting, Serra emphasized the enormous cost of building and maintaining AI, which could potentially improve the insurance sector but also has drawbacks.

These drawbacks include rapid obsolescence and massive energy consumption of data centers. Serra stressed the importance of not being swayed by the allure of AI and understanding where it can be helpful. The high cost of AI necessitates a significant investment and strict return measurement, he pointed out. He noted that for small and medium-sized enterprises (SMEs), accessing AI suites offered by tech giants like Amazon and Google is relatively affordable, providing them with an opportunity to scale their businesses.

Occident has a dedicated AI unit that identifies areas where AI can increase efficiency, with professionals who understand the complex insurance business. This team works on specific challenges, analyzing whether it is worth pursuing them, according to Serra. While AI can automate certain aspects, human intervention remains crucial, especially in delicate situations like communicating with clients about claims.

Serra cautioned that although certain AI applications could emulate human behavior, he advocated for caution and understanding where AI can provide value. Occident's growth strategy focuses on balancing technological tools with the principles of the business. Serra noted that despite the caution, the group is advancing towards its growth objectives, undergoing a deep transformation process to simplify operations.

The company decided against listing on the stock market in January, viewing it as a source of financing. Occident intends to adopt an inorganic growth strategy, though the current environment is not conducive to acquisitions. The company emphasizes local market opportunities, noting that it holds a 5-6% market share in Spain, with a theoretical growth margin of 94%.