Ironshore’s recent executive seminar for broker partners addressed the broad impacts of Artificial Intelligence (AI) and its implications on the Insurance industry. Our guest speaker, Tom Koulopoulos, is Chairman and Founder of Delphi Group, a Boston-based think tank providing advice on leading edge technologies to Global 2000 organizations.
Previous posts covered the Impact of AI and the tremendous amount of data produced by a tech driven, hyper-personalized economy and the existential threat to the insurance industry. Here, via Tom’s unique storytelling, we explore how these potential perils can become advantages for a nimble business willing to change how they approach strategy and tactical delivery as well as how their underwriters and analysts approach learning and collaboration with their insureds.
In the past, the world advanced through periods of innovation followed by relative stability. This growth was supported by the ability create scalable efficiency through process definition and breaking down complex programs into highly specified and standardized tasks1. The bureaucracy created was neither nimble nor prone to innovation.
Today, exponential change coupled with increasingly hyper-personalized and predicative customer experiences require institutions and individuals to change old approaches and scale “learning”. This change is not just about skills, training, and education. Rather, it is about shedding old behavioral patterns within the paradigm of entirely new digital technologies. Also, this new digital ecosystem is creating so much data and radical changes to human behavior, it is no longer enough to employ advanced analytics and models. Institutions need those algorithms to “learn” and improve themselves giving rise to Machine Learning.
Machine Learning fuels the AI that will support the opportunity for insurance to evolve and scale in a constantly innovating and disruptive world. Insurers and underwriters will no longer "use the past as a surrogate for the future". Machine Learning will arm them with scalable tools to effectively combat fraud and predict risk. Robotic Process Automation will perform complex and repeatable tasks with 100% reliability. Artificial Intelligence will drive the ability to predict and manage increasingly complicated emerging risks and liability exposures and even regulatory pressures. The innovative insurer will deploy new learning and collaboration models that provide a complete picture of the digital ecosystem to give their insureds the means to use the innovations that these technological advances provide as well as provide the human oversight of Machine Learning and Artificial Intelligence that regulators currently require.
Ironshore knows the future is changing and we are changing to meet it. We have a nimble operating model designed to ensure a stable and scalable operation capable of supporting our growth trajectory. An important part of this operating model is and will continue to be adapting quickly to new technology and market conditions. Using AI to leverage the tremendous amount of digital information about behavior and outcomes will be key to that adaptability. AI, Robotics, and Machine learning will be used to support underwriters by taking over repeatable manual processes so they can focus on making complex risk decisions and supporting insureds facing new technologies, changing market conditions and shifting environmental patterns.
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