Robots and AI bring new risks and opportunities

As the world increasingly embraces automation, it forces underwriters to adapt to a new risk environment. However, insurers themselves are leveraging the capabilities of artificial intelligence (AI) to remain competitive, improve processes, and increase efficiency, according to two new reports from Lloyd’s. The first report is titled ‘Taking control: artificial intelligence and insurance’ and was published in cooperation with the University of Surrey. It analyses the associated risks of AI implementation as well as the potential for AI to help insurers improve their operations. The report identified four risk areas for AI: trust and transparency, ethics, security, and safety. As AI becomes more complex, cyber breach impacts are more likely to become larger. Meanwhile, ambiguity and legal uncertainty is contributing to unanswered questions around who is ultimately liable when something does go wrong.