Ironshore & Liberty Mutual'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 and futures to Global 2000 organizations. Named one of the industry’s most influential information management consultants by InformationWeek magazine, Tom Koulopoulos is an authority on the implications of trends in technology, society and business for global organizations. In this multi-part blog series, Tom leads us on a thought-provoking journey to answer the following question and many others.
“The world is built on action...The world is built on scale...AI is not scalable today based on the current technology and business models.” Artificial Intelligence is an idea. How do we scale the idea to create value? How do we minimize it as a threat and actualize the opportunities it presents?
AI is an idea requiring a previously incomprehensible amount of data optimized for a specific set of results for its value proposition to be realized. The journey of technology began with the first 2-ton 3.5 MB computers in the 1940’s and moved to cloud based Big Data lakes capable of managing zettabytes (1021) of data today. By 2200 there will be more data than 100X the number of grains of sand on every beach in the world. To navigate the logarithmic increase in data and user computing systems (which is increasing 1.2 orders of magnitude each decade), we will have to transition to quantum computing. This massive ecosystem of data and proliferation of user computing devices gives rise to the ability to design systems that can be optimized to predict behavior and create enhanced, frictionless customer experiences.
Intended and unintended behavioral shifts caused by these new data and technology driven experiences is the often-overlooked cultural component of change. Technology becomes the great equalizer. We are no longer separated generationally by technology. But rather, we can now be defined by our behavior and how we interact with technology and leverage it to enhance our lives.
The companies that have access to and know how to interpret and create value from these innovations will have the power to create major shifts in how we live, work and make decisions.
The implications for Insurance are broad; How do you navigate the shift from actuarial based prediction of risk and behavior to AI powered real-time risk prediction and mitigation or avoidance? The solution requires transformation of internal processes and staying abreast of technological changes that will outpace legal precedents as product liability shifts across the supply chain.
Ironshore’s in-depth experience and nimble structure allow us to anticipate and adapt to the unprecedented pace of change facing commercial insurance today. We provide our clients with the best possible protection. We are retooling our operations to leverage Robotic Process Automation and Machine Learning and reschooling our workforce to include advanced Data Analysis skillsets. Clients and Brokers will continue to have access to seasoned underwriters who are uniquely positioned to address emerging risks with unparalleled product offerings and expertise in virtually all areas of product liability and financial products.
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Graphic credit:“State of the Connected Customer.” Salesforce Research, 2018