Innovation
The future is now
Zurich North America leaders and specialists weigh in on artificial intelligence and how it could impact insurance.
It’s an understatement to say artificial intelligence (AI) has recently sparked a lot of excitement, along with no small amount of trepidation. Much of the attention has been on ChatGPT and other large language model (LLM) tools made available to the public. People have been awed by the positive capabilities of the technology, but also alarmed by how it can be used to produce content that could be easily assumed to have been created by humans. Startlingly realistic replications of the voices and recorded images of well-known people have also stoked worries about the spread of misinformation.
But AI is not new, and its opportunities and risks have long been on the radar of Zurich North America’s leadership, as well as our data, technology and risk specialists.
In recent months, Zurich has published several thought-leadership pieces on the topic, while also sharing the insights of our specialists at various events, panel discussions and webinars.
Zurich is mindful of its responsibility, which includes ensuring fairness and privacy with transparency and clear accountability.
Zurich is mindful of its responsibility, which includes ensuring fairness and privacy with transparency and clear accountability.
Zurich is mindful of its responsibility, which includes ensuring fairness and privacy with transparency and clear accountability.
Zurich North America CEO Kristof Terryn had an optimistic take on the technology in a Future of Risk article published in July. Terryn noted how claims processing efficiencies could be greatly improved with AI and also explained how it is being used successfully in some areas of underwriting risk management.
“You can see that insurers can use AI for more than just data extraction,” he wrote. “At Zurich, we apply AI to help make business decisions and improve the quality of risk decision making. AI can also improve speed and even transition into automation.”
On the flip side, Terryn acknowledged some of the serious potential pitfalls of AI, especially when it comes to data privacy.
“Zurich is mindful of its responsibility, which includes ensuring fairness and privacy with transparency and clear accountability,” he wrote. “We do this through our public data commitment that states how we aim to be a leader in responsible handling of data and support ethical use of technology.”
Jane Rheem, Chief Data and Analytics Officer for Zurich North America, contributed to Future of Risk with an article on the evolution of AI use in the industry.
“The promise of AI for insurers is to help make more informed underwriting, pricing and claims-handling decisions. But the transformative power of AI goes beyond claims and underwriting,” Rheem wrote. “It could impact the entire insurance value chain. It may also play a big role in designing new products that are more intuitive and offer even more accurate insurance coverage.”
At a National Association of Insurance Commissioners’ forum in May, Rheem spoke about Zurich’s approach to using AI responsibly.
“Having a collaborative relationship with the NAIC and chief insurance regulators from all 50 states, the District of Columbia and five territories has provided the opportunity to work together on issues of importance to the industry, including technological innovations like big data, AI and machine learning,” Rheem said.
Regulation is also very much top of mind for Lynne Grinsell, VP, Head of State Affairs for Zurich North America. She and her colleagues are also keeping a close eye on legislative issues related to AI.
“In an evolving landscape of data privacy and AI regulation, businesses must be aware of various state, federal, and global initiatives,” Grinsell wrote in an article published in August on Future of Risk. “Business leaders need to stay informed and comply with relevant legislation while leveraging AI to benefit their organizations and customers responsibly.”
During a webinar hosted by Insider Engage in May, Jennifer Hobbs, VP, Lead Data Scientist at Zurich North America, participated in a lively panel discussion on the opportunities and risks of AI. Hobbs said the advances in LLMs and greater access to the public at large are what has marked this next step up in the technology.
“With truly relatively minimal effort, you can start seeing the impact it could have in your business, and so I think the bar to adoption is much lower than it has been,” Hobbs said.
But Hobbs warned that easy adoption also presents a big risk for companies not cautious with private data and not carefully customizing AI tools to specific and well-monitored business uses.
“Don’t throw your private data into the public instance,” she said, noting one major corporation has already gotten in hot water for leaking company data through ChatGPT. “If you’re experimenting with ChatGPT, make sure it’s in a private environment, that you have a private instance, before you start throwing sensitive data in there.”
Like Terryn and Rheem, though, Hobbs sees much beneficial potential in AI and noted it is already being used widely in the industry.
Keep up with Zurich’s though leadership on AI and other issues by visiting FutureOfRisk.com, where we cover what’s new and what’s next in risk and resilience.
Zurich Resilience Solutions:
AI use ultimately comes down to data and decisions.
For the Risk Engineers and other risk specialists of Zurich Resilience Solutions (ZRS), artificial intelligence is not a new topic, though naturally their learnings are advancing as the technology quickly evolves. AI is already a part of tools and services used by many insurers and the businesses they serve, whether in analytics, telematics (including wearable technology), web platforms, chatbots, various devices and more.
In looking at how AI can work best for Zurich and our customers, Roi Hansraj, Head of IoT (Internet of Things) for ZRS, says setting up a good foundation is key.
“We have to get our process right and information right to make sure we’re gleaning the right, unbiased, customer-beneficial insights,” Hansraj explained. “That applies to AI, but also to any tools we use.”
Though application of AI can come in countless forms, Hansraj noted that in broadest terms, the initial opportunity of advanced AI learning for insurance comes in a connected ecosystem for customers and across the industry to help customers prevent potential losses.
“AI and telematics and the Internet of Things — all those can be data pieces we use in predictive modeling to help them,” he said. “It all really comes down to how we use industry knowledge, information or data to make better decisions. The initial step in using AI is about trying to do that effectively and efficiently for our customers and for Zurich.”
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5 PROGRAM LEADER