As new technologies continue to evolve and come online for the business world, so too do their iterations in the insurance sector. Recently many new tools have been developed which are designed to manage risk, minimize uncertainty and generate profits, boosting productivity and efficiency within the sector. Developments such as the
Data analytics for legacy carriers - a radical transformation
Data is at the core of the businesses that legacy insurers run. While insurers have used advanced analytics for decades to sort through masses of data, the speed of processing from
AI can identify potential fraud, predict claims behavior,
Security in the age of generative AI - new types of risk
Generative AI is already being wielded by bad actors, as they seek to transform the new data AI tools into capabilities to bypass security systems, steal personal information, access financial data and perform other activities.
A consequence of this is
Conversely, AI security organizations and insurers are using AI to combat attacks by detecting suspicious activities and identifying and sealing off of potential vulnerabilities before a breach occurs.
Insurtechs at the vanguard of AI
Insurtech startups and established organizations by their very nature are at the forefront of technological innovation, but with the advent of generative
Generative AI can help entrepreneurs develop innovative products and services that resonate with the market. Existing companies will also be better able to refine their offering, improve loyalty for current clients and reach new ones. The digital insurer Lemonade, for example, has even described itself as "
An increasingly important value proposition from the insurance sector is expanding personalized coverage and product offerings that meet the unique requirements of both individuals and groups of customers. Generative AI will be able to further hone those capabilities for insurtech organizations.
AI for automation and new job profiles
Generative AI will further enhance the automation of previously manual or even legacy technology processes in the insurance space, such as underwriting. While the Covid-19 pandemic sped up the adoption of automated processes, the new generation of generative AI products will accelerate that change even faster.
There will also be a growing need for new types of professional profiles trained in the management of data and analytics, for example in the types of queries that need to be fed into AI engines. AI researchers will become increasingly important in the sector. Carrier Liberty Mutual partnered with MIT university to gain access to the skill sets needed to improve its
Generative AI will play a significant role in the future of insurance, though much remains to be seen in what ways it will impact the industry. As with many sectors, generative AI is only recently beginning to be understood, let alone harnessed, though the industry can expect much innovation, and quickly.
What is certain is that the most nimble legacy carriers and insuretechs which are able to adopt new innovations quickly will be well-positioned to thrive in this rapidly changing landscape.