Episode #165
Sep 4, 2025
Advancing Workers’ Comp Through AI Partnerships & Predictive Intelligence
Stan Smith from Gradient AI
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Stan Smith from Gradient AI shares his expertise in advancing workers’ comp through AI partnerships and predictive intelligence. Discover how Gradient’s partnership with Terra gives adjusters earlier insight into high-risk claims, reduces costs, and improves outcomes for injured workers.
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Why This Episode Matters
Episode 165 of the InsurTech Geek Podcast welcomes back one of its earliest and most forward-thinking guests—Stan Smith, the visionary behind Gradient AI. With over two decades of experience in predictive analytics and machine learning, Stan returns to dive deep into how AI is reshaping the workers’ compensation space. In this conversation, hosts James Benham and Rob Galbraith guide listeners through an evolution of technology, business logic, and intelligent decision-making at scale.
This episode is a must-listen for anyone involved in claims, core systems, insurance innovation, or AI application in regulated industries.
From Supply Chains to Claims: Stan Smith’s Predictive Journey
Stan’s story begins not in insurance but in supply chain optimization, where he helped large organizations like United Technologies understand supplier risk. Following 9/11, Gradient’s early machine learning models could predict supplier insolvency before businesses were even aware, marking a turning point in how data was used for foresight, not just hindsight.
This background laid the foundation for Gradient AI’s powerful shift into insurance—especially workers’ comp.
“We were able to predict which suppliers might go out of business—before the companies even realized it.”
– Stan Smith
Debunking Legacy Insurance Myths with Data
One of the most striking stories Stan shares revolves around the frequent flyer myth in claims—i.e., the belief that a claimant with multiple past claims is always a costly case.
Gradient’s models showed otherwise. In fact, 70% of these claims closed quickly with minimal cost, despite the adjusters’ gut instincts saying otherwise.
“High frequency is not necessarily a driver of high severity.”
– Stan Smith
These revelations underscore why relying on AI-driven pattern recognition—and not just human intuition—is essential for modern claims management.
Embedding AI Into the Core of Workflows
A core theme of the episode is the “next-best-action” framework. Instead of overwhelming adjusters with data or abstract predictions, Gradient integrates recommendations within the workflow. The system highlights what to do next (e.g., assign a nurse case manager) and—critically—explains why.
“If they have to look somewhere else, they’re not going to do it.”
– Stan Smith
This makes AI not just informative, but actionable—a crucial differentiator in an industry constrained by time and regulation.
Partnership Spotlight: Terra + Gradient AI
A major announcement in the episode is the partnership between Terra and Gradient AI, aligning a cloud-native core system with an AI-native intelligence engine.
Why it matters:
✅ Terra’s speed in deployment eliminates the delays often seen with legacy core system rollouts.
✅ Gradient’s predictive insights enhance claim outcomes by supporting timely, informed decisions.
✅ Together, they aim to provide full-circle intelligence from the inside out.
“We want to be decision support, but in a really specific way.”
– Stan Smith
The LLM Wave: Disruption or Integration?
Stan weighs in on the rise of large language models (LLMs) like ChatGPT and Anthropic’s Claude. While acknowledging their value—particularly for summarization and document interpretation—he emphasizes that verticalized AI still holds the key for real, industry-specific transformation.
“Technology moves faster every year—and that’s just the new normal.”
– Stan Smith
Key Takeaways
✅ Predictive analytics can outperform human assumptions in complex insurance scenarios.
✅ Next-best-action models embedded in the adjuster’s UI improve both adoption and effectiveness.
✅ Terra + Gradient AI offer a powerful partnership between cloud-native core systems and AI-native decision tools.
✅ LLMs are powerful, but vertical AI with industry-specific data will lead the next phase of meaningful automation.
You Might Also Like:
- 10 Ways to Improve Claims Management
Practical strategies to enhance claims efficiency—ideal for anyone interested in the real-world application of insurtech innovation. - What is Reinsurance?
A foundational read for understanding how insurers protect themselves—relevant to any discussion on regulation and risk.
Past Episode Recommendation:
- Episode 3 – AI, Predictive Analytics, Artificial Intelligence with Stan Smith
Stan’s first appearance on the podcast—a perfect companion to this episode showing his evolution and Gradient AI’s growth.