In the UK, AIG Europe Limited is one of the largest insurance companies specialising in the UK business insurance market. With offices throughout the country, AIG insures many of the UK’s top businesses, thousands of mid sized and smaller companies, as well as millions of individuals. Over the past 60 years, AIG has established an enviable reputation for developing innovative insurance products that keep in step with new trends and directions in business. Today, AIG has one of the widest product ranges in the market. youTalk-insurance sharing AIG insurance news and video.
AIG President and CEO Brian Duperreault asks 'Will robots take over the insurance industry?'
Robots already make our cars and one day soon will flip burgers at fast food restaurants. While the trend to automation has been mainly associated with the manufacturing sector, the financial services industry certainly isn’t immune. In fact, that’s the finding of a recent Linkedin survey, which reports that nearly a quarter of fintech professionals fear automation will also cost them their job.
LinkedIn asked for my thoughts on what this means for the insurance industry. In short, I would say automation isn’t a future inevitability – it’s already here. And in our business, that’s a good thing. Think about it this way:
If I’m a local florist, I’m working all the time. If I’m not serving customers, I’m placing orders, meeting with vendors and running all aspects of my business. I know that protecting my business and employees should be a priority, but spending time with an insurance agent to prepare a simple policy is pretty low on my list. The reality today is that a machine or algorithm can probably do a better job quickly producing a policy that meets my needs as a small business owner. It will certainly save me time that I can invest in growing my business.
For insurance professionals, this sounds scary. Like I’m suggesting we don’t need people to write policies. But that’s not true.
Insurance will always remain a people business. It’s just that these people will be doing different things.
In my opinion, the biggest need in our industry will be having people who know how to use this technology to better manage risk for our clients and can help them in a time of need. Our florist will not want to talk with a chatbot or algorithm if he is confused about a business-threatening claim.
Another consideration: we have strong and abundant data from auto accidents, which makes possible an almost exclusively data-driven model in auto insurance. By contrast, data on oil platform accidents is much less rich, so the expertise of the underwriter, along with data, is critical to properly underwrite the risk.
Complexity demands human involvement. Underwriting the risks facing a Fortune 200 or 250 company is complicated and constantly changing. A machine alone can’t do this, so there will always be a need for a skilled person and team at the table for these types of insurance deals.
So what’s the impact this could have for AIG?
Data can improve the work we do and make it more efficient. And for companies like AIG, that means helping us to be better underwriters and risk managers.
Investment funds like Two Sigma use data intensive quant tools to gain insight about investment decisions, and insurance is no different. When applied to insurers, data-intensive processes – like those used in quant investing to learn everything about a stock – make underwriting better. In fact, just last week we announced that Seraina Macia will be joining AIG’s leadership team to lead the continued development of a technology-enabled platform that is bringing technology and data analytics to risk selection, pricing and claims-handling processes. I believe this will put us at the forefront of the industry.
But despite the opportunities that technology brings us, I recognize there is a human impact. Companies like AIG will always need insurance professionals, but the skillsets and knowledge required of those individuals will evolve over time as we move further into a data driven world. Our future workforce will be staffed with adaptive, tech savvy employees who welcome change, and will help us continually create the industry’s future.
By hiring the right people with the right skills, AIG will not only grow, but stay ahead of digital trends and innovations in the industry. The company will continue to attract top-notch talent, which will help propel us faster to the top of the insurance industry.
Insurance will continue to see and feel the impact of automation, but contrary to the fears of many, it will only make our business better, our customer relationships stronger and help us to attract the right talent for the future.
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