By Henry Uche
Artificial Intelligence (AI) is taking over some human job as companies cut incorporate it into day to day operations. It is believed that if more companies in Nigeria incorporate AI, there would be an increase in job loses.
At a recent insurance conference, sector experts and analysts unanimously echoed that operators with the support of the National Insurance Commission (NAICOM) should embrace AI with open arms, saying – it’s the way forward.
While some professionals believe that AI is a threat to the sector (if not adopted in their operations immediately), arguing that many companies would be kicked out of the market by smart operators; there are strong voices in the industry who are neutral with respect to AI. They just believe that insurance companies should know what is good for them bearing in mind their customers’ satisfaction as the central factor to consider in every strategic plan, policy design and decision.
President of the Governing body, Risk Managers Society of Nigeria (RIMSON) Mr. Gus Wiggle, said in an interview that the insurance sector is not threatened by the emergence of AI in the corporate world at the moment, as is obtained in the legal, banking, medical and other professions.
Mr. Wiggle who was the chairman of Nigerian Insurance Association (NIA), said while other sectors are agitating about AI, the insurance sector should keep doing their part with sound policies design/formulation, and adherence of same with innovative products and services which AI can support.
“I see AI poised to significantly impact the insurance industry (soon) starting with motor insurance. I see AI revolutionizing claims processing more in motor insurance. Imagine where after a minor accident, the vehicle is diagnosed to assess the damage and a mobile drone is dispatched for inspection. I know this, because I am working with some bright minds from Tunisia already working on something similar to this and soon will be deployed to the Nigerian market.
“However, the insurance sector over time (in future) will be partially threatened by the emergence of AI in the corporate world because it will no longer be business as usual for some. The world is evolving, technology is just the catalyst. Yes, we need to embrace technology which is in form of AI and other technology applications, but we should apply them rightly. However, if we don’t embrace it immediately, Heaven would not fall. Very soon, there would be no doctors nor lawyers around because AI would soon take over their jobs entirely, it has already started happening in developed economies, but that would not happen at the moment in insurance sector,” he said.
With AI, he affirmed that risk assessors and managers would be able to be analysed and predict future risks to allow for proper pricing based on individual risk profiles. He noted that AI will enrich the insurance ecosystem with rich data on customers behavior and lead to better engagement.
He added that in the event of an accident, AI would help to determine the risks, determine the frequency of claims and do the loss ratio and certain calculations in the insurance industry, while humans does major part of the work.
“AI is going to create challenges and opportunities for the insurance industry. The major challenge I see is that of resources for those who want to stay competitive. That brings to the discussion of recapitalisation for the industry. I don’t see a company with a capital of N3bn playing in this field. AI will surely separate the boys from the men when fully deployed.
“There must be human beings on ground to do majority of the work in the entire value chain of insurance. It’s human being that program the AI. For insurance, AI would not take the totality of human job, but a part of it. More so, AI would not eliminate the job of loss adjusters into to, it can only take a fraction of it, so AI is not in its entirety a threat to the insurance sector. Howbeit, we should be the best in what we are currently doing and be conscious of its presence because it has a powerful influence in all human endeavor.
“I want to see AI more as a transformative force than a threat, because those that invest in it will thrive in the evolving landscape while those who are still debating if they should ignore it, risk falling behind,” he said..
Similarly, a risk management expert, Dr Obass Olufemi, corroborated Mr. Wiggle’s position, saying that he do not see AI as a threat to Insurance business in Nigeria, however there are implications (if) the regulator and operators alike ignore it.
Olufemi who is the Head of Insurance Department at Lagos State University, said if players do not prepare ahead of time, it can only be disastrous in the long run. For instance; penetration would remain low, customers response and relationship would be hampered, claims investigation and management would be difficult, the technical and marketing aspect of insurance as well as customer relations would be endangered, as a result, the sector would be relegated to the background and lag behind eventually.
“I don’t believe AI is a threat to insurance rather it should complement and improve insurance business. There is nothing wrong if we deploy drones for agricultural underwriting and for survey to solidify and consolidate insurance business as well as increase insurance companies bottom line.
On readiness of players, he posted that the dynamic nature of customers, the demands of the market and insuring public should determine if sector regulator and operators are ready to adopt AI in its fullest. “Financially, it expensive, but in the long run it would be cost- effective. Though its implications on the behavioral aspect of our life may be an issue for debate, but we should not jettison it. The level of risk exposure would determine if we’re ready for AI or not” he submitted.