MSIG calls on industry to face “silent stalkers”
Richard Williams, MSIG chief information officer, has called on the industry to urgently address the profound effects the digital economy is starting to have on insurance.
In his keynote address at the Insurance Technology Congress this week he explained that the insurance industry faced tremendous challenges posed by the rise in internet technology in everything from household objects to infrastructure, ships and aircraft.
“Companies like Google, Amazon, Alibaba and Ebay are relentlessly pursuing new and different ways to derive value from the vast data that they hold. They are the silent stalkers of insurance in the digital economy, which is potentially a major threat but it is also a massive opportunity,” he said.
“‘The ‘Internet of Things’, whereby sensors imbedded in physical objects share information via the internet, is growing rapidly and producing a huge amount of data of real interest to insurers. This information will become increasingly important in underwriting and could be of great use in both pricing and loss prevention. For example if a building has an automated storm protection system that could be triggered by information being streamed in about an impending weather event, that could prevent a loss and reduce insurance costs. Similarly for marine risks, the ability to monitor cargo and be notified instantaneously about any issues could also prevent loss and allow underwriters to price more effectively.
“Automating and streamlining back office functions to improve data analysis and pricing and to make better underwriting decisions will become essential. The future leaders will be those that invest in technology and are willing to innovate and collaborate to provide value added services to customers.”
He concluded by saying that, with the banking and financial services sectors already ahead of insurance in terms of their data innovation, the insurance industry needed to be bold, pre-emptive and innovative in engaging with the benefits that new digital technology offers to ensure the industry’s continued vital contribution, value and relevance to society.
