Issue #42 | 5 April 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: cyber risks extend past organisational boundaries; insurers facing heightened challenges in cyber security; risks and rewards of AI in insurance; and is the insurance industry at risk of relying too heavily on AI?
Cyber risks extend past organisational boundaries
Managing third-party contractors is increasingly critical for data security and regulatory compliance, experts said at the Professional Liability Underwriting Society’s Cyber Symposium recently, Business Insurance reports.
As cyber insurance claims surge due to third-party exposures, businesses are urged to assess vendor’s cyber resilience as rigorously as their own internal controls, emphasising detailed contracts, well-defined incident response plans and robust regulatory compliance frameworks.
Insurers facing heightened challenges in cyber security
With cyber threats on the rise and a growing skills gap in cyber security, insurers are facing heightened challenges in the industry, Insurance Thought Leadership reports.
The surge in demand for cyber insurance and the complexity of pricing policies necessitate a shift towards resilience-focused strategies. This involves refining underwriting processes, policy structures and claims management to adapt to the evolving threat landscape. Furthermore, educating clients on business continuity, disaster recovery and the importance of cyber resilience can help lower demand and mitigate risks, creating a more secure digital environment.
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Risks and rewards of AI in the insurance sector
As the insurance sector embraces artificial intelligence (AI), it faces both significant risks and promising rewards, Insurtech Insights reports.
Key concerns include the failure and malicious use of AI, as well as issues with data security. However, AI offers substantial opportunities, particularly in risk assessment and claims management. Despite the potential benefits, insurers must navigate evolving challenges such as geopolitical uncertainties and disruptive technologies, with AI ranking high on the industry’s risk agenda for 2024.
Is the insurance industry at risk of relying too heavily on AI?
As the insurance sector embraces AI?for improved efficiency and customer service, questions arise regarding the potential over-reliance on AI and the necessity of preserving human expertise, The Fintech Times reports.
Various experts weigh in on this balance, highlighting the benefits of AI in streamlining operations, enhancing customer engagement and improving efficiency. However, they also caution against the risks associated with AI, such as biases in algorithms and privacy concerns.
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