Issue #36 | 23 February 2024
Stay in the know on the stories shaping the future of insurance, with the weekly lowdown brought to you by Genasys.
This week in The Lowdown: risk professionals urged to consider the threats of generative artificial intelligence (AI); European insurers are intensifying their digitalisation efforts amid fears of an impending recession; innovating insurance coverage for emerging risks and mitigating intensifying risks with technology.
Rising concerns over generative AI prompt urgent action from risk managers
“All risk professionals should consider the threats of generative AI to their business”, a panel webinar, hosted by Commercial Risk, has warned.
Jonathan Shehan, technology and transformation risk manager at Simplyhealth, and Scott Fenstermaker, vice-president at Riskonnect highlighted the widespread presence of AI risks, even for businesses not directly utilising AI services, due to potential exposure through supply chains, third-party services, or employee usage of AI tools such as ChatGPT.
Riskonnect’s first-ever New Generation of Risk Survey of 300 risk managers globally, with the majority of respondents in the US, revealed 7% do not anticipate any threats to their business from generative AI.
European insurers intensify digitalisation efforts amid economic uncertainty
Amid fears of an impending recession, European insurance industry leaders are ramping up efforts in digitalisation to improve customer experiences and operational efficiency, as revealed by a recent survey by Information Services Group (ISG). Results indicated that two-thirds of respondents plan to fast-track digital investments over the next two years, with a focus on enhancing payment channels, cybersecurity, augmented reality and artificial intelligence (AI), Reinsurance News reports.
President of ISG EMEA and Chief AI Officer, Steve Hall, emphasised the industry’s shift towards a “digital first” approach, citing the significant growth in AI investments and the importance of strategic partnerships to access digital capabilities and talent.
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Innovating insurance coverage for emerging risks
Navigating the intricacies of insuring emerging risks requires a delicate balance of science and art in the insurance industry, Risk & Insurance reports. While underwriters continuously assess new risks, they often find that incremental enhancements can effectively address evolving needs without the needs to start from scratch.
Michael Marks, VP of emerging markets and innovation at Nationwide, breaks the foundational pillars of developing new coverage into: emphasising the importance of understanding risks, collaborating with partners and crafting precise policy language to develop new coverage that aligns with strategic objectives.
Mitigating intensifying risks with technology
As risks escalate in today’s landscape, encompassing inflation, geopolitical tensions and climate crisis, insurers are increasingly turning to technology to navigate these challenges, FT Adviser reports. Reports indicate that a significant percentage of global executives, particularly those in the insurance sector, have already felt the impact of environmental and business transition risks.
The adoption of technologies such as regulatory technology, cloud computing and generative AI are on the rise, with insurance leaders leveraging these innovations to address emerging risks, enhance customer experiences and streamline claims processes.
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