The insurance industry, built on the principle of predictable risk, is facing a new era of unprecedented challenges. From the systemic shocks of climate change to the cascading complexities of global cyber threats, the very nature of risk has become more interconnected and computationally demanding. To navigate this landscape, industry leaders are looking beyond traditional models toward a new technological frontier: quantum computing.
In this exclusive interview, Carlos Ordoñez, a leading voice on digital transformation in financial services, sits down with Romi Sumaria, Director of Business Development at QAI Ventures, a global VC in Quantum, bringing deep expertise in quantum technology and its applications across industries, with a special focus on quantum computing and security. The conversation moves beyond the hype to explore the strategic importance of quantum computing, dissecting its potential to revolutionize risk modeling, fraud detection, and customer value. More importantly, it provides a practical roadmap for insurers on the essential steps they must take today to prepare for this technological shift and achieve a state of true quantum readiness.
Authors
Carlos Ordóñez
NTT DATA
Vice-president, Global Insurance Innovation & Marketing
Romi Sumaria
QAI Ventures
Director of Business Development
1. The challenge: Unprecedented complexity in a traditional industry
Before exploring the solutions of tomorrow, it is crucial to understand the fundamental pressures pushing the insurance industry to its limits today. The sophisticated, yet ultimately classical, computational models that have served the sector for decades are beginning to strain under the weight of a modern, hyper-connected risk landscape.
Carlos Ordoñez: Romi, thank you for joining me. From your perspective, what are the primary challenges that insurance leaders are grappling with today, particularly when it comes to modeling and forecasting the risks that define their business?
Romi Sumaria: Thank you for having me, Carlos. The core challenge for insurers is a growing gap between the complexity of the risks they face and the capability of their tools to model them. Leaders are struggling with computationally intensive events that defy traditional simulation. This includes forecasting the financial impact of climate-related disasters, understanding systemic market risks, or modeling the ripple effects of a major cyber-attack. These events involve so many interdependent variables that their multidimensional dependencies exceed the limits of classical computation. The models face exponential scaling problems, making them intractable.
This computational barrier also stifles innovation. Insurers find it incredibly difficult to develop new, data-driven products for complex modern exposures, such as disruptions in global supply chains or parametric coverage for climate events. They are effectively trying to price the future using the tools of the past. It’s clear that a fundamentally new kind of computational power is required to meet these challenges head-on.
2. The quantum solution: Reimagining risk, fraud, and customer value
While the challenges are significant, emerging technologies like quantum computing offer a fundamentally new toolkit for the insurance industry. This is not merely an incremental improvement but a paradigm shift in how information can be processed. This section will dissect the specific, high-value opportunities that quantum presents across the insurance value chain.
Carlos Ordoñez: Given those limitations, how specifically can quantum computing help insurers tackle these complex problems and unlock new forms of value that are currently out of reach?
Romi Sumaria: Quantum computing offers a pathway to solve problems that are currently intractable. By processing information in a fundamentally different way, it can unlock value in several key areas:
In Advanced Risk and Capital Modeling, Quantum computers excel at complex simulations. For insurers, this means the ability to run far more precise stochastic models to understand and price tail-risk events - the low-probability, high-impact scenarios that can threaten solvency. This extends to capital management, where quantum optimization can help create more efficient capital allocation strategies and reinsurance structures, maximizing the performance of the balance sheet.
Regarding Enhanced Fraud and Anomaly Detection, the industry loses billions to fraud annually. Quantum-enhanced pattern recognition can sift through vast, unstructured datasets - from claims notes and transaction records to sensor data - to identify subtle anomalies indicative of fraud or a coordinated cyber-attack. This moves detection from a reactive, rule-based process to a proactive, pattern-based one.
Another application area is Hyper-Personalized Customer Experiences: By combining quantum-inspired algorithms with graph-based data models, insurers can create more granular, context-rich customer segments. This allows them to analyze diverse and unstructured data types—from text and audio in claims notes to imagery—to achieve hyper-personalized products and pricing. It’s about moving from broad demographic buckets to a true "segment of one," creating value for both the customer and the carrier.
The potential is immense, but harnessing it requires confronting the practical hurdles that come with adopting such a transformative technology.
3. The reality check: Beyond the hype of quantum adoption
The potential value is clearly immense, moving from risk mitigation to value creation. But this brings us to the hard part: how does a traditional insurer, which is not a tech company, even begin to approach such a transformative and complex technology? The real barriers are often strategic, cultural, and foundational - not technical.
Carlos Ordoñez: That potential is compelling, but there's a lot of hype in the quantum space. For insurance leaders who are rightfully skeptical, what are the real, on-the-ground barriers that separate the promise from reality? Where do companies get it wrong right from the start?
Romi Sumaria: That’s the critical question. The biggest misconception is that this is a hardware race. It’s not. The real obstacles are much closer to home and can be summarized in a few key points:
Firstly, the bottleneck is data, not compute: The primary bottleneck for most insurers today is not a lack of computing power, but the quality, integration, and governance of their data. Many still rely on older, rule-based internal models. Before they can leverage quantum’s potential, they must modernize this data foundation.
Secondly, algorithms are the true gatekeeper: The ultimate value of quantum will depend on the development of domain-specific algorithms for insurance, such as for actuarial or capital modeling. The availability of a quantum processing unit (QPU) is secondary to the existence of a mature algorithm that can deliver a clear advantage.
Thirdly, organizational buy-in: Frankly, winning internal support and securing even minimal resources - like a single full-time employee dedicated to exploring this - is a far greater challenge than finding quantum specialists. Executives need to understand why this matters for the long-term health of the business. Building literacy and securing sponsorship must precede any attempt to scale.
And last, but not least: The focus on incremental ROI presents another challenge: The near-term goal should not be immediate commercial return. Instead, the focus should be on learning and experimentation through proofs-of-concept. This "quantum readiness" approach reduces the high cost of playing catch-up later.
Since insurers are not going to build this capability alone, the ecosystem they choose to engage with becomes the most critical factor in their success.
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4. The ecosystem imperative: How to access the quantum future
Given the immense challenge of developing quantum expertise and technology in-house, strategic collaboration has become the only viable path forward for most enterprises, including insurers. Engaging with a vibrant "quantum ecosystem" is the critical enabler for this journey, providing access to talent, innovation, and market-ready solutions.
Carlos Ordoñez: That’s a crucial point. If an insurer isn't a tech company, how can it effectively tap into this highly specialized world of quantum innovation? Could you describe the role of an ecosystem builder, like QAI Ventures, in this process?
Romi Sumaria: An ecosystem builder is the bridge between the enterprise and the frontier of innovation. For an insurer, trying to navigate the quantum landscape alone is inefficient and risky. An organization like QAI Ventures provides a curated, structured pathway to engage with the technology and its pioneers. The value comes from several key functions:
We provide direct access to innovation: Through global Startup Accelerators in key hubs like Europe, North America, and the Asia-Pacific region, corporate partners get direct access to a vetted pipeline of early-stage startups that are developing relevant quantum solutions.
Another USP is our Venture Building and Talent Scouting: Ecosystems don't just find startups; they help create them. They work to transform promising research from labs into market-ready solutions. Furthermore, through initiatives like the GenQ Quantum Hackathon, they scout top global talent, giving partners a first look at the next generation of quantum experts.
And let’s not forget our mission of Collaborative Experimentation: QAI Ventures’ ecosystem model is built on the principle of "collaborating for boundary-pushing synergy." It facilitates partnerships with vendors, research institutions, and consortia, which is far more effective and cost-efficient than any insurer attempting to build or own this capability in-house.
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5. The integrator's role: Bridging quantum innovation and enterprise scale
While a vibrant ecosystem provides access to cutting-edge startups and novel algorithms, a critical gap often remains: integrating that raw innovation into the complex, and often legacy, systems of a large insurance carrier. This last mile of implementation is where many proofs-of-concept fail to deliver enterprise-wide value.
Carlos Ordoñez: That makes sense for accessing raw innovation. But innovation often dies on the vine when it meets the reality of legacy IT infrastructure. What’s the final piece of the puzzle that connects a brilliant algorithm from a startup to real-world business value inside a multi-billion dollar carrier?
Romi Sumaria: Exactly. The role of a leading technology integrator is to act as the crucial bridge between quantum potential and enterprise reality. A startup may have a brilliant algorithm, but it doesn't have the deep knowledge of an insurer's decades-old policy administration systems or complex data architecture. An integrator closes this gap via three angles:
On the one hand by managing the immense complexity of integrating new quantum-inspired algorithms with an insurer's existing data infrastructure, cloud platforms, and core systems.
Besides, we are also helping to build internal quantum literacy across key business functions - actuarial, data science, risk, and finance - to ensure the necessary organizational buy-in for a new solution to be adopted.
After all, our mission is to scale successful proofs-of-concept into robust, enterprise-grade solutions. They provide the engineering muscle and platform expertise to take a brilliant idea from a lab environment and make it work securely and reliably for millions of customers.
This final piece ensures that innovation doesn't just stay in the innovation lab but translates into a tangible competitive advantage.
6. Final advice: A journey of readiness, not an arms race
Carlos Ordoñez: To close, for the insurance executive who might be feeling overwhelmed by this topic, what is the one piece of concluding advice you would offer them as they consider their organization's quantum strategy?
Romi Sumaria: My single most important piece of advice is this: approaching quantum computing in insurance is not an arms race, but a strategic readiness journey. The insurers who will ultimately benefit the most are not necessarily the ones who invest the most, the earliest. They will be the ones who are the most prepared.
Success will come down to three disciplined actions: first, preparing your data and models now so they are ready for future quantum integration. Second, building internal quantum literacy and external partnerships to ensure you can identify and act on opportunities. And third, maintaining a disciplined focus on value-driven experimentation rather than getting swept up in hype-driven investment. It’s a marathon, not a sprint.