Here’s a must watch video on Robots and the effect they are going to have on our lives. It’s not insurance specific, but for anyone genuinely interested in what the world of the future looks like and how to prepare for it, this is a very good way to spend 15 minutes. It’ll also mean you don’t have to buy the bestselling Rise of the Robots by Martin Ford so I’ve already saved you £10.
Although created in order to shock us it’s difficult not to be taken in by the logic. Robots are going to take many of our jobs and this is going to have a profound affect on society. Having already saved you £10 I’m not also going to summarise the video for you, but as a taster they draw a parallel between the fate of horses as a mode of transport following the invention of the car and the fate of those who now drive in the age of the driverless vehicles. There are an estimated 70 million people globally who drive for a living today.
The customary first line of defence of the doubters (driverless cars will occasionally go wrong and that they won’t cope with the complex array of possibilities and events) is also given short shrift. Driverless cars don’t have to be perfect, they just have to be better than human drivers who kill 40,000 people every year in the US alone – and that’s before the current texting while driving epidemic!
The bottom line is that this generation of robots is self-learning and can make decisions that get increasingly well informed over time. That’s going to push a lot of people who sit who sit in front of a computer screen today out of a job. If you still think that insurance is going to be in some way immune, then take a look at the Stock Exchanges of the world today. Much of the decision-making that instigates buy and sell decisions is algorithmic and it’s algorithmic because it cam assimilate and process the vast amount of information that drives those calculations quicker and more reliably than the human brain.
The naysayers are going to argue that we’re heading for a social catastrophe and that with a significant proportion of the population unemployed and unable to earn the money they need to provide for themselves, but I’m a serial optimist and I don’t buy that. It’s all about preparation. My generation has been fed the same doom and gloom scenario for about the dwindling supply of oil and our economic dependence on it, but inevitably innovation and humankind’s gift for self-preservation has solved that issue. We still consume a lot of oil and gas, but new technology in the form of fracking has and the emergence of alternative forms of energy are now well advanced providing alternatives which are also renewable and more environmentally friendly.
Why should we not be able to adapt and evolve to deal with a future in which robots do many of our jobs? For society at large, as for the insurance industry, it comes down to preparation – we need to understand what working with and alongside robots really involves and adapt to it. I don’t aspire to be a social commentator, but I will express my views on what I think that means for the insurance community
First, it’s not about whether robotics will affect the industry, but how. It has already arrived in various guises with algorithmic processing, and artificial intelligence doing things with our data that we were only dreaming of just a few years ago. And that’s just the start. In a few years time the insights that these technologies will be able to extract from our data will blow our minds and be far superior to anything that the brightest and the wisest actuaries or underwriters could possibly achieve.
To find out what’s being done and who’s doing it you have to be curious. You have to go foraging and find these technologies and the people developing them and find out what they are doing. As other industries have embraced and invested earlier than we have in insurance, the likelihood is that you’ll have to extrapolate out from what other communities are already doing.
For every IBM building a Watson, there’s a hundred small and smart “one man and his bot” outfits also doing things that have the potential to change our lives. To fulfill their potential they need access to realistic test data, a clear set of industry specific requirements and some initial funding.
So what we need to do now is being curious enough to engage with these people, open minded enough to share our ideas and data with them and generous enough to help fund them. Not all of them, but the ones we believe and we believe can make a difference. My advice to the insurance industry then is almost identical to that which I gave to my godson when he was 21, namely “Play the field, take precautions and get married when you find the partner ”
" The Bots are coming for you too buddy". As all good Boy Scouts know, we need to Be Prepared