Reinsurers have overestimated the value of artificial intelligence (AI), which has shown very limited successes in the vast majority of the value chain and which will not be applicable in the foreseeable future, according to Christian Mumenthaler, Chief Executive Officer (CEO) of Swiss Re.
Speaking in a German language interview with Handelsblatt, Mumenthaler explained that although AI has produced results in fields like medical imaging or facial recognition, a scenario in which re/insurance industry jobs are replaced by machines is a distant prospect.
AI has proved successful where there is a lot of training data and the output does not have to be very precise, Mumenthaler told the publication, but the narrative of applications such as AI-controlled automatic air, rail and road traffic is unrealistic.
While technological innovation continues to accelerate, in reality the future will not look very different to the past 20 years in terms of technology, he said, adding that he was sceptical about technological progress over the next ten years.
Nevertheless, Mumenthaler maintained that technology does offer the potential for enormous savings and improvements across almost all aspects of re/insurance.
He stressed that the greatest technological advantages for re/insurers over the next few years will be realised through digitisation and through the replacement of the old IT systems that many companies still rely on.
The better exploitation of data forms one of the four pillars of Swiss Re’s technological strategy, and it is this, rather than AI, which will have the most beneficial effect on the re/insurance industry, Mumenthaler explained.
The potential for digital innovation also formed an essential aspect of Swiss Re’s discussions with Japanese technology and telecoms investor SoftBank, Mumenthaler said, although the parties were eventually unable to reach an agreement.