Early this year, news of a large Japanese insurance company replacing 34 of their employees with artificial intelligence (AI) sent shockwaves throughout the industry. While automation is nothing new in the insurance industry—insurers have been transforming and automating their core processes for years, after all—”artificial intelligence” is the term that really hit a nerve. “AI” and “robotics” often conjure up Hollywood images of machines taking over human jobs and becoming our masters.Executive SummaryPwC’s Anand Rao distinguishes two types of AI—automation and augmentation—as he explains how the jobs of insurance professionals are changing. “The future of the insurance workforce is…man and machine,” he writes. With AI augmenting their decisions, Rao believes future insurance professionals will interact with AI—some using their industry knowledge to teach the AI, and others using technical expertise to build better AI.
But what really is the reality? Should we be wary of AI, or should we embrace it? Will it automate all key insurance activities, or will it help us make better targeting, underwriting and pricing decisions?
Answering these questions requires us to understand what artificial intelligence is and how it may impact us.
AI is the theory and development of computer systems that perform tasks or make decisions that normally require human intelligence, such as speech recognition, decision-making, visual perception and so on. AI is not a single technology but an assortment of areas like: