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The Advent of AI in Insurance
I’ve witnessed firsthand the growing reliance on AI in insurance, from automating claims processing to underwriting policies using complex algorithms. AI’s ability to analyse vast amounts of data quickly and efficiently is undeniably an advantage. It reduces the time taken to handle claims, enhances fraud detection, and personalises policies based on consumer data.
For instance, insurers can now use AI to analyse driver behaviour via telematics, offering tailored premiums based on real-time data. If you think about it, AI is helping insurers make more accurate predictions and better manage risk. However, with this increased automation comes a host of legal, ethical, and regulatory concerns. As I’ve come to understand, the stakes are high, and both insurers and regulators need to prepare for the new AI-driven future.
Regulatory Lag and the Need for Action
One of the biggest concerns I’ve read about is the gap between the speed at which AI is being adopted and the regulations in place to govern its use. There’s a certain inevitability to AI regulation, but it’s not happening fast enough to keep pace with the technology. This is a point that both the National Law Review and Insurance News Net emphasise. The general consensus is that regulators are still playing catch-up, and this lag leaves insurers in a grey area where compliance is unclear.
