Case Study – OpenAI Advisory Services – European Insurance Group – AI Engagement Re-scoped & 30% Cost Savings
Background
A European insurance group with pan-European operations was embarking on an AI initiative to enhance underwriting and customer service.
The company hired a consulting firm to develop a custom GPT-driven solution for automating claims analysis and policy servicing. It was the insurer’s first large-scale generative AI project.
While the potential was exciting, the insurer’s procurement and IT leaders were cautious about the consulting agreement. They needed the Statement of Work (SOW) to be clearly defined, costs justified, and the company’s data and IP fully protected before giving the green light.
Challenges
The initial SOW and contract from the consulting firm raised several red flags. The project scope was broad and not clearly bounded, leaving room for scope creep and escalating fees.
The proposed budget was padded with non-essential extras, and payment milestones weren’t well-aligned with concrete deliverables.
Moreover, the contract lacked strong protections for the insurer’s intellectual property and data. It implied the consulting partner could potentially repurpose parts of the AI solution for other clients, and it didn’t clearly state that the insurer would own the custom-trained models or code developed.
These gaps set off alarms. The insurer worried it might overpay for an ever-expanding project and lose control over critical AI assets.
Lacking experience with AI-focused SOWs, the insurer brought in Redress Compliance to review and redline the agreement before proceeding.
How Redress Compliance Helped
Redress Compliance performed an OpenAI Consulting Engagement Review & Redlining for the insurer. The Redress team meticulously reviewed the proposal, breaking down each element of the scope. They worked with the insurer to strip away optional extras that didn’t support the core goals. The SOW was re-scoped into clearly defined phases, each with specific deliverables tied to payments. This ensured the consulting firm would only be paid upon delivering tangible results, eliminating any blank-check work. Next, Redress tackled the cost issue. They scrutinized the consultant’s effort estimates, identified overestimates, and negotiated reductions in hours and resources – ultimately cutting about 30% from the project’s original cost. In parallel, Redress strengthened the contract’s data and IP protections. They added clauses ensuring the insurer would exclusively own all AI models, code, and outputs developed during the project. The consulting firm was barred from reusing or sharing the insurer’s data or proprietary AI components. These redlines came with solid justifications, and the consulting partner ultimately agreed to a refined SOW with a leaner scope, strong IP safeguards, and a significantly reduced price.
Outcome and Impact
Thanks to Redress Compliance’s intervention, the insurance group proceeded with its AI project on much more favorable terms. The engagement’s scope was now focused on the insurer’s priorities, and the deliverables and deadlines were clear. This ensured the consultant was accountable at each phase before payment. Financially, the insurer saved roughly 30% of the initial project cost by removing unnecessary work and inflated fees – savings of hundreds of thousands of euros. Equally important, the insurer retained full ownership of the AI solution. The final agreement ensured all trained models, custom code, and data remained the insurer’s property, preventing vendor lock-in or future licensing fees. With confidentiality and IP clauses in place, the company’s sensitive data and algorithms stayed protected. Leadership felt secure embracing AI with the project now well-controlled. What began as an open-ended, high-risk consulting engagement was transformed into a tightly managed project with clear value outcomes and no loss of control.
Client Testimonial
“Redress Compliance turned a dense consulting proposal into a clear, manageable project plan,” said the Head of Procurement at the insurer. “They helped us strip out the fluff and nail down who delivers what, when, and for how much. We ended up shaving almost a third off the cost and, importantly, we keep complete ownership of our AI solution. Thanks to Redress, we entered this engagement protected and in control – and the project is hitting its marks.”
Call-to-Action
Bringing in consultants for your AI program? Make sure the deal works for you. Redress Compliance will review and redline your AI project SOWs and contracts to cut out scope creep, secure your IP rights, and ensure you only pay for real results. Before you sign any AI consulting agreement, enlist Redress Compliance to safeguard your interests and set your project up for success. Act now.
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