AI Economics for InsurTech
Insurance technology carries the heaviest legacy system burden of any industry. 75% of IT budgets go to maintaining 30+ year old systems. AI underwriting is promising but introduces new cost structures most InsurTech companies don't model.
Legacy Core System Debt
Most insurers run on legacy policy systems. Modernization is expensive, and maintenance of COBOL monoliths consumes most IT budget.
75% of IT budget on legacy maintenanceRegulatory Compliance Overhead
Insurance operates under state regulations. Every product change requires filing review, which accumulates compliance debt.
$2M-$10M/yr compliance engineering costAI Underwriting Economics
AI-powered underwriting introduces variable compute costs: inference, data enrichment APIs, and model retraining cycles.
$0.50-$5.00 per AI underwriting decisionClaims Processing Debt
Claims systems accumulate complex technical debt as edge cases become hardcoded exceptions, creating audit and maintenance risks.
40-60% of claims code is undocumented business rulesInsurTech Advisory
Richard Ewing advises InsurTech companies on legacy modernization economics, AI underwriting unit costs, and regulatory compliance debt. R&D Capital Audits for insurance technology.
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Richard Ewing — AI Economist & Capital Auditor