Norman Black Insurance Industry Principal Consultant, SAS
The impact of artificial intelligence on the insurance industry is expected to be transformative. To capitalize on all that this offers — and be able to provide customers what they want and need — stakeholders must deftly negotiate technology, industry politics, talent and culture roadblocks to ensure a successful journey. Not many years ago, artificial intelligence (AI) was the stuff of movies like I, Robot or 2001: A Space Odyssey, or of novels by Isaac Asimov or Philip K. Dick. It is now a reality: cognitive computing, machine learning, natural-language interfaces and related technologies allow computer systems to interact in a human fashion, make decisions and apply outcomes mechanically, to have the appearance of sentience. The insurance sector is waking up to the disruptive nature of this technology. Accenture’s Technology Vision for Insurance 2017,
findings of which are based on a survey of more than 550 insurance executives from 31 countries, clearly shows the insurance industry is well aware of AI’s potential. In all, 75% of respondents report they believe AI will either significantly alter or completely transform the overall insurance industry in the next three years. Two-thirds of those polled say they expect AI to significantly change or completely transform their companies.
AI, BIG DATA AND IOT Two related trends give AI meaning and context: big data and the Internet of Things (IoT). Big data Moore’s Law, which states that computer technology will double in power and halve in cost every 18 months, is not slowing down. Nowhere is this more obvious than in the field of memory. This reduction in cost — along with new database technologies — enable the processing of vast amounts of data at terrifying speeds in memory and the processing of both unstructured data (think, among other things, text records, social media postings and video) and structured data. Since various sources estimate that anywhere from 70% to 90% of organizational data is unstructured, this is a significant development.
September 2017 Canadian Underwriter 37