Trends
Challenges and opportunities of AI in insurance technology
OUR TAKEAI presents applications and challenges in the insurtech space. Personalised pricing may bring benefits and risks, and there are issues with AI generating deeply falsified content that can be used for insurance fraud. At the same time, while AI can help to analyse large amounts of data and a…
Headline
OUR TAKEAI presents applications and challenges in the insurtech space. Personalised pricing may bring benefits and risks, and there are issues with AI generating deeply falsified content that can be used for insurance fraud. At the same time, while AI can help to analyse large…
Context
OUR TAKE AI presents applications and challenges in the insurtech space. Personalised pricing may bring benefits and risks, and there are issues with AI generating deeply falsified content that can be used for insurance fraud. At the same time, while AI can help to analyse large amounts of data and accelerate administrative tasks, there are limitations to relying exclusively on AI for underwriting, and AI is still to be solved in detecting the problems it generates. -Rae Li, BTW reporter Funding for global insurtech companies grows by 40% to $1.27 billion in the Q2, thanks largely to investment in AI-focused businesses. However, the use of AI in insurance poses challenges, particularly in dealing with the risk of “deepfakes” in fraudulent claims and the potential exclusion of potential customers by AI models.
Evidence
Pending intelligence enrichment.
Analysis
Although insurtech funding has cooled since peaking at $16 billion in 2021, companies still have high hopes for AI to automate tasks and reduce costs. There are also some concerns that AI can lead to a large number of job losses. Gallagher Re , one global reinsurance broker, reports that in Q2, around 33% of insurtech funding goes to AI-focused companies. AI is valuable in insurance pricing and underwriting, but the report mentions that there are limited successes when underwriting is left entirely in the hands of AI. The report indicates that it can be a mistake to remove human labour altogether, as AI is very useful in analysing large amounts of data and speeding up administrative tasks. AI may find solutions to its own problems, for example in detecting deeply forged content. However, AI-generated deeply forged content can be used in insurance fraud, raising concerns about authenticity and the security of the insurance industry. Also read: Eastern Alliance and CLARA partner on AI-optimised insurance claims Also read: Shielding your coins: The rise of cryptocurrency insurance
Key Points
- The use of AI in insurtech has driven personalised pricing, which may be beneficial to some customers but may result in other customers not being able to access insurance.
- AI-generated deeply faked content such as photorealistic images and videos can be used in insurance fraud, raising concerns about authenticity and the security of the insurance industry.
Actions
Pending intelligence enrichment.
