The Promise And Perils Of AI

While the news media often treats artificial intelligence (AI) as an emerging development, it has been around for more than 50 years and is more integrated into modern life than many people realize. It is used in popular map programs to predict the fastest routes and traffic congestion; by speech recognition programs for texting and word processing; by virtual assistants, spam filters, and email sorting systems; and in many more applications.

What is newer about AI is that the exponential increases in computing capacity achieved over the last five to 10 years have greatly expanded its potential and increased the power of the tools that bring it to life, including natural language processing and machine learning.

AI seeks to adapt to its environment -- mimicking, replicating, and even replacing human cognition. It can recognize speech, translate languages, perceive visual images, and make decisions.

AI can accomplish tasks humans cannot. For example, over 70% of claims can have some flag for fraud. It is commercially impossible to manually check such a high hit rate, but AI can be trained to close the gap.

Such capabilities are why AI is a transformative business technology. For insurers, AI can unlock new business value via enhanced experiences, improved forecasts and predictions, better processes, and uniform consistency of claims.