By 2023, according to IDC’s analyst projections, 25% of the Fortune 500 will be successfully leveraging quantum computing's unique ability to quickly solve highly complex business problems. In financial services, for example, leaders have long known that quantum has the potential to resolve challenges that confound today’s best computers. As a global leader in insurance with a proactive approach to innovation, this company understands that becoming quantum-ready will help it provide even more value for its customers while also improving business results. To help quantum deliver on its promise— and to become the first insurer to truly put it to work—the company turned to Accenture, which has been exploring and applying this technology since the mid-2010s. Accenture, which also offers extensive insurance domain knowledge, believes quantum could become one of the most disruptive technologies of all time, fueling growth and competitive advantage, reducing risk and increasing operational efficiency.
"I’m very satisfied with the pilot on Quantum Optimization applied to core insurance, which I believe is a breakthrough in this field. Based on this success, we’d like to strengthen our partnership."
— Insurer's Leadership
When tech meets human ingenuity
A powerful proof of concept
Seeking to help its client provide improved coverage at better rates while also enhancing business value, Accenture assembled a global team with diverse perspectives on ways to put the quantum algorithm to work.
The team was able to work quickly because of client’s strategy to be in the forefront of R&D and Accenture's longtime investments in quantum information science. This includes partnering with universities, vendors and consortiums, as well as developing an extensive asset and patent library and integration solutions. Accenture now offers more than 30 Amazon Web Services-enabled, quantum ready, industry specific applications running custom formulations on premier quantum hardware in areas such as portfolio & currency optimization, credit scoring and derivative pricing.
One major goal was to reduce the risk of insurance loses leveraging quantum computing algorithms. This led to a joint proof-of-concept solution designed to perform the extensive calculations and optimizations necessary to protect the client against rare but large risks.
To accomplish this, both client and Accenture had to determine which insurance portfolios (business lines) should be reinsured by third parties to minimize risks—thus helping the company to protect its customers while maximizing value for all stakeholders. This is a highly complex problem shared by insurers across the industry.
Design Thinking methodologies enabled the teams to identify the business problem, determine desired outcomes, gather the information needed to create the quantum algorithm and design a suitable data model.
To make sure the outcomes of the project were as accurate as possible, both client and Accenture designed the proof of concept based on complex real-world data and created seamless links to quantum resources around the world. In addition, the client team closely shadowed Accenture's quantum information scientists and system integrators in order to learn the process of transforming a classical problem into one that can be run on a quantum computer.
A valuable difference
A potential loss of 8 billion
In 2021, natural catastrophes caused global insured losses of $111 billion. A small improvement in the way these losses are mitigated could lead to a large fiscal benefit. We developed a quantum and hybrid computing proof of concept for the insurer to mitigate the risk of large losses in re-insurance portfolios, which can exceed $8 billion annually. We predicted that a naïve brute force would take centuries to solve the entire production problem. This could be accelerated with a hybrid of quantum and classical approaches, but today’s quantum machines can’t handle a problem of this size. The proof of concept also showed that a hybrid approach is the best annealing method for this problem. In addition, together we were able to demonstrate that the cost of accessing quantum computing systems through AWS is more economical than accessing directly through the providers.
Now the first insurer to apply quantum computing to reinsurance business, the client is so pleased that it and Accenture are discussing expanding on the advantages discovered from this project. This would include designing and deploying a feature-rich, scalable version of the application. Accenture consulted with the client to configure and deploy AWS infrastructure along with AWS’ managed-service quantum computing capabilities, Amazon Braket. To support this application and future systems, Accenture would provide the client with managed-service quantum computing capabilities via the cloud. Additionally, training and other services based on Accenture’s Quantum Foundry approach would be included. This would cover talent needs, organization planning and strategy.
"The client’s reaction is that of excitement and hopefulness. They believe that this will lead to something bigger and better. Now we can move on to scaling the solution and transforming their book of business."
— Shreyas Ramesh, Global Lead – Next Generation Computing GTM