AI in Insurance
SOCIETY OF ACTUARIES RESEARCH INSTITUTE ANNOUNCES PARTICIPATION IN THE DEPARTMENT OF COMMERCE CONSORTIUM DEDICATED TO AI SAFETY
The Society of Actuaries (SOA) Research Institute announced that it will lend its actuarial expertise, joining more than 200 of the nation's leading artificial intelligence (AI) stakeholders to participate in a Department of Commerce initiative to support the development and deployment of trustworthy and safe AI. Established by the Department of Commerce's National Institute of Standards and Technology (NIST), the U.S. AI Safety Institute Consortium (AISIC) will bring together AI creators and users, academics, government and industry researchers, and civil society organizations to meet this mission. As a member of this consortium, the SOA Research Institute will harness its expertise in AI security and its ethical use for the actuarial profession and insurance industry.
"We are honored to be part of the Artificial Intelligence Safety Institute Consortium initiated by the National Institute of Standards and Technology," said R. Dale Hall, FSA, CERA, CFA, MAAA, Managing Director of Research, Society of Actuaries Research Institute. "As the world's largest actuarial association, the Society of Actuaries is actively involved in artificial intelligence (AI) research in all areas of actuarial practice. We look forward to utilizing our expertise and collaborating with consortium partners to accelerate the progress and implementation of the responsible use of safe and trustworthy AI," stated Hall.
Research
Digital payments are a growth opportunity for P&C insurers
Paper checks continue to comprise a significant portion of transactions in the P&C sector.
Amid rising competition, economic uncertainty, and soaring customer expectations for speed and convenience, digital payments capabilities have emerged as more than just a better way for property and casualty insurers to collect premiums, disburse claims, and reconcile transactions. They're quickly becoming a competitive opportunity for carriers seeking to boost customer satisfaction and retention, cut costs, and enable next-gen operating models.
Instant claims disbursement
According to a recent survey from Mastercard and VPay, 60% of consumers report receiving their last claim payment by check, with 50% having to wait three or more days to access the money. So it's no surprise that more than half say they'd be willing to switch insurers to get access to instant digital claims payments deposited to their bank accounts or through "push-to-debit" transactions directly to card or payment apps.
The possibilities enabled by digital payments are as compelling as they are urgent. As a growing number of P&C insurers replace legacy systems with flexible, cloud-based platforms, it's reasonable to expect that by 2030, those fastest to capitalize on digital payments will gain significant share over rivals.
Laura Drabik, Chief Evangelist, Guidewire
February 2024 Labor Market Pulse
Are you looking to learn more about the insurance labor market? Check out PULSE for a look at the latest insurance industry labor statistics!
The insurance labor market remained stable throughout the first month of 2024. Notably, January hit a record high of 3 million jobs in the insurance carriers and related activities sector.
Revised numbers from the Bureau of Labor Statistics reflect the 2023 average monthly employment for the industry was 2.96 million – 34,000 more positions than previously reported. Additionally, industry unemployment dropped 1.1 points from December, to 2.3%. Meanwhile, the overall U.S. economy’s unemployment rate is 3.7%, marking 24 consecutive months under 4%.
Pulse Newsletter, The Jacobson Group
Survey Shows 1-in-5 People Have Considered Committing Insurance Fraud
One-in-five respondents said they had at least considered committing insurance fraud, with half of those saying that they had gone through with their plans, while 30% of respondents said knew someone who’d at least considered committing insurance fraud.
Nearly half of those committing insurance fraud say they did so out of desperation or financial gain: 35% say they were influenced by their peers, while 25% say they were unaware of the consequences.
Customertimes, a digital consultancy with insurtech expertise, surveyed 2,000 adults in the U.S. to see how the economy, tech adoption and insurance providers’ policies affect the insurance industry.
Many respondents justified fraud by blaming insurance policies and loopholes:
45% believe that loopholes in policies made insurance fraud easier One-in-four believe that unfair insurance policies justify breaking the rules Two-in-three said that companies that commit insurance fraud are a bigger problem than individuals A large percentage of those polled said they trust technologies to improve fraud detection. Three-quarters (71%) believe that technology like AI and data analytics will help prevent insurance fraud, and 66% said they would be willing to share more personal data if it could help prevent fraud and potentially lower premiums.
Claims
Climate Change and Future Claims Management Strategies
In an era marked by significant environmental changes, the insurance industry stands at the forefront of adapting to and mitigating the effects of climate change. Claims professionals are increasingly recognizing the need to understand and prepare for the challenges posed by a changing climate. This understanding is crucial not only for effective claims management but also for the long-term sustainability of the insurance sector.
Recent Innovations in Catastrophe Claims Handling
In the aftermath of catastrophic events, the insurance industry is often tasked with a daunting challenge: managing and processing a surge of complex claims quickly and efficiently.
Recent advancements in technology have brought about a paradigm shift in how these catastrophe claims are handled. Innovations such as drones, satellite imagery, AI, and machine learning are not just enhancing the efficiency and accuracy of claims handling but are also reshaping the entire landscape of catastrophe claims management.
Commentary/Opinion
Evaluating OnStar Insurance
Last year, financial software giant Intuit decided to discontinue QuickBooks Insurance after failing to achieve traction and ROI goals.
Last month, Amazon said it would shut down its insurance venture, just 15 months after entering the space.
“Over the last year, we have been evaluating various businesses and programs, and as a part of that we’ve made the difficult decision to discontinue the Amazon Insurance Store,” shared Vassil Gedov, head of the Amazon Insurance Store. In other words, the insurance venture was evaluated against other ventures and it didn’t make the cut.
Big companies can do big things. However, if the consumer pain point isn’t big enough, they will need to go to great lengths to potentially achieve something grand. And when the time and financial investment is significant, it’s natural to question the ultimate destination. Intuit and Amazon came to the realization that the resources needed for their insurance ventures could potentially deliver a better ROI elsewhere. Now, the spotlight is on General Motors.
COMPLETE ARTICLE HERE Avi Ben-Hutta, Editor at Coverager
How can satellite technology boost the insurance sector?
It will "enhance every phase," claims CEO
Satellite technology and Earth observation data are poised to play a significant role in building resilience in an increasingly volatile and unpredictable world.
More insurers and governments are tapping real-time satellite imaging capabilities not just to measure and predict risks amid natural catastrophes, but also to make data-driven decisions about disaster response and rebuilding resiliently, according to Rafal Modrzewski, CEO and co-founder of ICEYE.
“Earth observation data can enhance every phase of insurers’ and emergency management organizations’ response,” he told Insurance Business.
Addressing world and business leaders at Davos
Last month, Modrzewski delivered a message about satellite technology’s advancements and its use for climate resilience at the World Economic Forum in Davos.
Satellite imaging advancements are poised to radically change several industries that require trustworthy data to support decision-making, according to the CEO.
“Possibilities include improved management of carbon sequestration, initiatives for ocean cleaning, and the development of fully autonomous shipping systems,” Modrzewski said.
Casualty comes back to bite
Casualty has eaten into 2023 insurer results, as carriers experience adverse reserving pressure in a post-pandemic landscape.
The pinch is unlikely to be limited to insurers that have already reported, with analysts anticipating that other carriers are likely to find themselves facing a costly rethink.
Markel, AXIS Capital, and Selective Insurance have yet to fully recover from post-results share price dips that followed reserving updates.
AXIS felt the heat, with a $425 million reserve strengthening contributing to a Q4 $150.1 million loss.
Markel moved to trim down unprofitable business amid $330.7 million of adverse development across US general liability and professional liability.
Selective, which recorded net adverse casualty development of $10 million in Q4, hiked general liability reserves to the tune of $55 million.
Jen Frost, Editor Key Media
InsurTech/M&A/Finance💰/Collaboration
Six Ways InsurTech Streamlines M&A
For companies seeking acquisitions, the right InsurTech can optimize that process from start to finish, and InsurTech can make smaller companies more attractive to potential buyers.
In 2022, the insurance sector saw 449 completed mergers and acquisitions (M&A) worldwide. That’s the highest in a decade, up from 418 the previous year, according to law firm Clyde & Co’s insurance growth report. This increase should come as no surprise; M&A can help companies increase their competitive edge, expand their market presence, and optimize their operations. That said, the challenges shouldn’t be underestimated. There’s a lot to manage, from maintaining compliance and safeguarding customer service to integrating systems, databases, and processes.
The good news is that an effective technology suite can facilitate that process, while also accelerating the returns on that investment. Read on for six ways the right InsurTech streamlines M&A.
Eric Ayala is the senior vice president, Americas for Novidea, creator of a cloud-based, data-driven enterprise insurance management platform for brokers, agents, MGAs/MGUs, and wholesalers.
Recommended Events
InsurTech Hartford Symposium 2024 | April 17 - April 18 | Mohegan Sun, CT
The InsurTech Hartford Symposium pushes the boundaries of innovation in insurance by bringing together the latest technology and top talent.
This year, we’re bringing every session to one massive main stage! All of our speakers will become the rock stars of the 125,000 square foot space as they step into the limelight
The Future of Insurance USA 2024 | May 15-16 2024 | Marriott Marquis Chicago, USA
Embrace AI | Propel Customer-Centricity | Outsmart Disruption
Set your future roadmap at Reuters Events: The Future of Insurance USA 2024 (May 15-16, Chicago), this year merging with Insurance AI & Innovative Tech USA to tackle both the strategic and practical elements of overcoming business critical challenges.
People
Fairmatic names Jim Hinchley President of Insurance to accelerates growth
Insurtech Fairmatic has appointed Jim Hinchley as President of Insurance to drive growth and “bring innovative new insurance products” to market.
According to Fairmatic, Hinchley’s proven track record in the commercial auto insurance space makes him “uniquely positioned” to help the firm enter its next growth phase.
Fairmatic serves businesses across a range of industries, including artisan contractors, last-mile delivery, non-emergency medical transport companies, transportation networks and others.
“By providing businesses with an easy way to monitor driving safety, Fairmatic is giving businesses proactive control over how much they pay for insurance,” the insurtech stated.
Canada
Poilievre wants more jail time for car thieves
Auto theft a national crisis, says Insurance Bureau of Canada
Conservative Leader Pierre Poilievre wants more jail time for car thieves amid what the Insurance Bureau of Canada (IBC) considers a national crisis.
With over 200 vehicles stolen on average every day, Poilievre wants to remove house arrest from the options available to those convicted of auto theft by indictment. He also would like the mandatory minimum sentence for a third offence to be changed, from half a year to three.
“I’m announcing that a Pierre Poilievre government will go after the real criminals by restoring jail, not bail, for repeat violent offenders and career car thieves,” a report by The Canadian Press quoted the election hopeful as saying during a news conference.