Disruptionsfrom technology could change the corporate landscape of the insurance business inthe coming year, industry professionals said during the RIMS Annual Conference inSan Diego.
Addressinga question about the challenges from the digital age, Lloyd's of London CEO IngaBeale told a group of attendees that she thought underwriting is among the jobs"most likely" to be replaced by artificial intelligence.Beale conceded she was "verysad to say" that human underwriters would probably disappear as she has workedas one over the course of her career.
Bealeduring a forum for senior insurance executives noted that a recent study found thatnearly three-quarters of industry professionals expect challenges from financialtechnology. But despite those challenges, Beale believes insurers should embracethe technology and use it to tailor its products to better meet customer desires.Customers want more choice in coverage and how it is delivered, and they preferusage-based products so that they are not paying for things they do not use, sheexplained.
"Thatmeans we've got to start using data … and work on how to capture data so that wecan deliver things that our customers want in the future," Beale said.
Insuranceindustry adviser Grace Vandecruze said the industry is run inefficiently becauseof its reliance on legacy technology that badly needs upgrading to adapt to thingslike mobile communication. Disruption could be so great that, 20 years from now,the biggest companies in the space might not be any of today's major players, saidVandecruze, who founded and serves as managing director of consulting firm GraceGlobal Capital.
"Thelargest insurance company might come from brand new entrants into the market thatdon't carry with them the legacy technologies and that find ways to sell insurancein the most efficient way possible," Vandecruze said in an interview.
Sucha future heavyweight could be a Google-based company, she said. Her view is nota novel one either. In a recent survey of insurance executives, many corporate leaderspointed to Google Inc.as a potential threatto their operations because of the tech company's store and proficiency with userdata.
Vandecruzecited New York-based Oscar Healthas an example of a startup that has leveraged technology to deliver innovative insurance.
"It'scompanies like Oscar thinking, 'How can we sell to an emerging, upwardly mobileinsurer at a lower cost?'" she said.
Duringthe senior executives forum, AIG Americas President and CEO Robert Schimek soughtto reassure college students in the audience that the business is a good one inwhich to seek careers despite challenges from technology.
"Ithink what we could really do for this industry is get you focused on the thingsthat really add value and get you out of doing the day-to-day monotonous work thatcomes with data entry," Schimek said.