Looking past the transformative potentials that artificial intelligence (AI) possesses for the re/insurance industry, one major factor still remains: peoples need for risk transfer and mitigation solutions.
AI technology may be able to enable new solutions and business models, but it simply cannot alter the “core mission” of the industry, according to Pravina Ladva, Swiss Re’s Chief Digital & Technology Officer, one of the authors of the reinsurance giant’s fourth installment of its ‘Decrypting AI for insurance’ series.
In the report, Ladva notes how the excitement surrounding AI is understandable.
She said: “ChatGPT has provided a good example of the potential capabilities of Generative AI to us all making its impact tangible. However, along with its clear promise, AI has also revealed its weaknesses. This interplay of promise paired with challenges will likely continue moving forward, as this technology evolves.”
At the same time, she adds how the future of AI hinges on the individuals who are developing and using it, adding how it is down to humans to ensure that AI creates value for society, without negative side effects, and how ultimately, AI will only be as good as those people who develop and utilize and the quality of the underlying training data.
Elsewhere, a large number of insurance firms have been experimenting with large language models (LLMs) such as GPT, though they are not yet fully deploying them.
As a result, these models potentially could make a major impact on the re/insurance industry, not only by automating processes, but also by automating tasks such as code generation and analytics.
Another key factor that is highlighted by Ladva is that in order to guarantee that AI fulfills its potential, it is important to “actively shape the technology now.”
She explains that the industry, has an obligation to drive the development of ethical AI that benefits society, ensuring it aligns with the industries values and needs, and that it is also crucial to recognize the roles that humans play in harnessing its power so that future generations will be able to benefit from AI applications.
In a previous edition of the report, Ladva outlined ways in which AI could help achieve the industry’s long-term goals and takes a deep dive into the immediate benefits of AI that can be taken into consideration. Swiss Re also defineed AI into various categories, depending on its scope, AI can be referred to as either “narrow-AI” which means a model designed to fulfil a specific purpose in a defined context or “general-AI” which is defined as a universal model with human-like intelligence
Meanwhile, Antonio Grasso – the Founder and CEO of Digital Business Innovation Srl -, the second author of the report, suggests that while AI is capable of creating content that appears to be original, it is fundamentally an echo of our input, therefore it is not an independent entity, but a tool that has been developed to transform our thoughts, knowledge, and creativity into new forms at a scale and speed far beyond our capabilities.
He explains that the technology has the potential to revolutionize efficiency, drive innovation and streamline processes across numerous sectors. However, he notes that to fully realize these benefits, he suggests that the industry thoughtfully guides the development and application of generative AI, maintaining a deep level of understanding of its potential and limitations to ensure its responsible, strategic use.
