Digitalization in the insurance industry: opportunities and challenges

Digitalization in the insurance industry: opportunities and challenges

According to a report by www.versicherungsjournal.at, there is a lot of talk about digitalization in the insurance industry. Allianz CEO Remi Vrignaud expresses his skepticism about the “digital dividend” and emphasizes that the digital transformation of the business model is still pending. He also mentions the challenges ahead from planned regulations that are intended to give the use of artificial intelligence a legal framework.

The planned EU regulation entitled “Artificial Intelligence Act” is intended to set uniform requirements for the use of AI in the EU. Four types of AI are distinguished, including high-risk AI, which must meet strict requirements in areas such as risk management, data governance, transparency and human oversight. There is also discussion about whether health and life insurance should be classified as high-risk AI candidates, which could potentially have negative effects on insured parties.

There are potential implications for insurance companies in areas such as claims settlement, underwriting and human resources management. Insurance intermediaries, on the other hand, are likely to be less affected, but could have points of contact with the new regulations when using chatbots. In general, it is recommended to prepare now for future requirements. The planned regulation could therefore have a partial impact on the insurance sector.

In summary, the regulatory framework for artificially intelligent insurance solutions will potentially have an impact on the market and the insurance industry. Insured parties could experience negative effects, while companies must prepare for new requirements to ensure the use of AI in accordance with legal regulations. It remains to be seen what effect the regulation will have in practice.