Beyond wonderland: how Swiss Re is using AI to boost contract clarity

In the famous satire Through the Looking-Glass, Humpty Dumpty tells Alice: “When I use a word, it means just what I choose it to mean, neither more nor less.” His approach may have worked in Wonderland, but in the real world of insurance and reinsurance contracts, words must mean exactly what all parties intend them to mean, in advance.

Even so, agreements on paper do not always translate into agreement in practice. Disputes can turn on the interpretation of a single term or clause, while wording ambiguity can obscure risks accumulating across portfolios. This is why proactive contract management and greater contract certainty are so important.

After many years of working to improve insurance wordings in our industry, Swiss Re is now strengthening these efforts by deploying artificial intelligence tools to improve contract clarity, accelerate wording reviews and underwriting decisions, and enhance contract management throughout the lifecycle of our in-force business.

This initiative supports Swiss Re’s broader adoption of AI technology, as we reimagine core insurance processes end to end within a robust governance framework that includes keeping human expertise at the centre of decision-making. Clearly, AI is not an experiment at Swiss Re – for our contract professionals, it offers a means of improving how our wordings are reviewed, understood and managed, adding value to our core businesses.

Swiss Re’s centralised repository of millions of contracts represents one of the industry’s most valuable sources of wording intelligence. Yet, like many other components of our industry’s risk-relevant data, information contained within those contracts is largely unstructured. Historically, this made wording reviews time-consuming and dependent on painstaking manual analysis.

The urgency of this challenge became particularly clear during the COVID-19 pandemic. In early 2020, Swiss Re launched a large-scale assessment of contract wordings to better understand potential exposures within our portfolios. At the time, it took approximately 45 days to pore over tens of thousands of contracts before a comprehensive picture emerged.

Today, advances in AI and Large Language Models are transforming that process.

One capability builds on an existing Swiss Re application by combining keyword search with conversational AI capabilities. This allows underwriters and contract professionals to query large volumes of contracts more intuitively, identify relevant wording provisions more quickly, and gain contextual explanations about how clauses operate. In certain use cases, tasks that previously required weeks of manual effort can now be completed much faster.

A second capability applies GenAI-enabled analytics to support the identification and analysis of wording patterns. It helps Swiss Re understand how specific terms, clauses and exposures are applied across portfolios, clients and geographies, providing deeper visibility into accumulations, trends and potential discrepancies. These insights support more proactive management of in-force business and portfolio exposures.

Across portfolios, AI-powered analytics enhance Swiss Re's ability to identify accumulations, trends and exposures contained in millions of contracts. And at the deal level, AI supports faster reviews by identifying missing clauses, deviations from underwriting standards, and wording inconsistencies that demand further attention.

Building on Swiss Re’s existing contract assessment strengths, we are upgrading existing tools with AI to accelerate reviews, increase uniformity, and support more transparent underwriting and contract decision-making. While still at an early stage, these capabilities will support Swiss Re in identifying wording issues and navigating legal and contractual complexities more effectively.

Based on progress to date, we are introducing these solutions incrementally into production. This will enable teams to engage earlier with clients and brokers to improve wording clarity and address ambiguities before they develop into contractual disputes.

While expert oversight remains essential throughout, these advances support efforts to improve data-driven cycle management and stewardship of risk exposures across relevant areas of the business, helping us make good decisions before losses materialise.

In line with Swiss Re’s broader AI efforts, our AI tools are designed to augment expert judgement rather than replace it. Underwriters and contract professionals remain fully responsible for interpretation, negotiation, and decision-making.

The real value lies not simply in automation, but in enabling experts to work with greater speed, consistency, and visibility as they manage increasingly complex portfolios. AI offers support in highlighting shortcomings, uncovering relevant insights quickly, and strengthening the connection between underwriting intent and portfolio outcomes.

Ultimately, insurance contracts work because words don't mean whatever we choose. They must mean what all parties align on and apply with a common understanding.

Our AI tools support this by bringing greater clarity and transparency to how contracts are crafted and understood. Put more simply, they are helping to keep the chaos of Wonderland out of insurance contracts, with clearer wordings, more consistency and fewer surprises.