THINKPIECE
“S
uccess in creating effective
Artificial Intelligence ( AI)
could be the biggest event in the
history of our civilisation or the
worst. The problem is that we
just don’t know”. These are words
spoken by the renowned physicist
Stephen Hawking’s at the 2017
Web summit and are words that particularly
resonate with me. Like most, I can see AI’s
immense potential while at the same time I
am uncertain… there is a niggle. Something
tells me that as a society we need to take
more of an active interest in AI develop-
ment and influence the digital journey to
ensure ultimately the world remains a place
where we would like to live.
WHAT IS AI?
When you mention AI, an immediate reac-
tion can be that you are referring to robots
replacing humans, as has been the focus of
numerous Hollywood blockbusters such as
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Issue 5 • March 2018 • The Insider
Blade Runner, the Terminator franchise, &
iRobot. These movies depict a future world
where artificial intelligence in the form of
robots take over the world and seek to replace
humans. But that's Hollywood. In many
ways AI refers to the replacement of human
activity and tasks with digital technology. AI
within a business, ranges from basic process
automation of repetitive and routine manual
tasks, to enhanced process animation based
around machine learning where the applica-
tion actually learns from experience and its
performance continually improves. The next
stage in evolution is the introduction of cog-
nitive technology which involves AI natural
language and empathic processing ability as
well as analytics of super data sets. Forrester
Research describe a mature AI system as a
self-learning system able to interact with
humans naturally, understand the environ-
ment, solve problems and perform tasks that
normally require human intelligence, qualities
and abilities. Advances in AI are predicted
to a point where we will finally see machines
that are able to learn enough about a situation
to make reliably predictable recommenda-
tions that we as humans will trust.
WHAT CAN WE EXPECT IN
THE WORLD OF INSURANCE?
Although an evolving technology AI is
also very much present in today’s working
environment. Theresa May spoke at the
WEF in Davos about the rate of AI start-ups
created in the UK over the past 3 years, one
a week. Exponential increases in computing
power and the availability of vast amounts of
data, which is being generated at a faster pace
than ever are driving these developments. An
IBM study has found that 90% of the data
on the internet has been created since 2016.
AI applications and their algorithms excel at
understanding the large amounts of complex
data now created.
AI is finding its way into all sorts of
endeavours, language translation and robotic
assistants, Chatbots and Robo advisors to
Cobots who work alongside humans. It
powers the technology behind Google maps
and search engines, Apple voice controls,
Facebook and Amazon.
Insurers equally recognise the potential
AI has to create value enhancing key process
lifecycles as well as product innovation and
are working to harness the technology. Octo a
telematics platform streams data from a cus-
tomer’s car allowing an insurer to proactively
reach out and offer tailored assistance almost
immediately if an accident happens. Cogito
is an application which combines AI and
behavioural science to provide an always-on
AI-powered assistant to support an insurance
employee/ broker in engaging with a custom-
er empathetically. By constantly listening into
a call to detect if the conversation becomes
strained, the AI nudges the employee/
broker to overcome emotional fatigue, and
transform that customer engagement into a
positive experience. Pypestream another new
Insurtech is offering ready-to-go business
process automation with chatbots and artifi-
cial intelligence. Its smart messaging platform
integrates seamlessly with insurance claims
processing. DAS Group UK, launched an app
in January 2018 which allows the public to
ask Alexa, Amazon’s virtual personal assistant,
a variety of questions. The information pro-
vided covers a range of common legal issues
such as disputes with neighbours, employ-
ment tribunals and redundancy, harnessing
the exponential increase in voice search over
the last 12 - 18 months and leveraging AI to
deliver a service.
AND THE LIKELY CONSEQUENCES?
Current focus is on AI augmenting tradition-
al processes rather than a case of machine re-
placing man. Nonetheless concern exists that
the successors to AI
techniques available
today could automate
qualities considered in-
trinsically human and
creative activities may
not remain beyond
the capacity of the
machine. It is under-
standable that concern
is heightened when
even experts can’t agree
as to whether AI will
ultimately benefit or
harm society.
A 2017 PwC report
suggests that because of the nature of back
office Financial services work undertaken in
Ireland automation here will have a greater
impact than in other European econo-
mies. This reflects a common theme in the
narrative associated with AI and how it could
displace a significant share of the workforce
globally.
McKinsey reported in December 2017
that 50% of current activities are techni-
cally automatable while 6 out of 10 current
occupations include 30% of activities that are
technically automable. Dramatic headline
figures but technical feasibility alone will not
determine adoption of AI and work force
displacement. Cost of development, labour
market dynamics, regulatory and social
acceptance will also determine the pace and
extent of AI adoption.
even experts
can’t agree as to
whether AI will
ultimately benefit
or harm society
Issue 5 • March 2018 • The Insider
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