Skip to main content
Journal Magazine: Informing Workplace and Facilities Management Professionals - return to the homepage Journal magazine logo
  • Search
  • Visit Journal Magazine on Instagram
  • Visit Journal Magazine on Twitter
  • Visit @Journal_Mag on Facebook
Visit the website of the Chartered Insurance Institute Logo of the Chartered Insurance Institute

Main navigation

  • Home
  • News
  • News analysis
  • Features
  • Study Room
    • A-Z
    • Question and Answer (Q&A)
    • Study Room Features
  • Opinion
  • CII Radio
  • Events
  • Digital Magazine
Quick links:
  • Home
  • Study Room
  • A-Z

A-Z of… InsurTech

Share on
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print
Open-access content 3rd January 2018

Article hero image.

Mathew Rutter and Stephen Turner take a look at what InsurTech really means for insurers.

InsurTech ranges from conventional cover where technology is the product, through to cyber cover and the application of technology to all aspects of the underwriting and claims processes.

For example, robotics and autonomous vehicles require the industry to rethink traditional first and third party covers. Here, traditional cover such as property or product liability will see new ways in which liability can arise. There are different contexts for familiar arguments about whether there is "damage" and when looking at the boundaries between traditional classes of cover.

Traditional risks such as product liability face new challenges with increased use of interconnected products -- no longer just for gadgets but traditional products such as fridges and boilers -- and artificial intelligence. These include looking at how interconnected products are juxtaposed and how liability will be determined if one of several products or services fails.

When analysing legal liability, consider the scenario where a robotic product learns through its environment: is the manufacturer or user responsible for a malfunction causing loss? Robotics and AI raise fundamental liability issues about where manufacturer liability stops and user responsibility begins, and whether users of robotics, like car drivers now, need their own liability insurance or whether for now at least, this remains a product liability risk. Where an interconnected product is the weak link in a home or business's cybersecurity, is this a manufacturer or user issue? If the focus is on manufacturers, a failure to identify so-called "silent" cyber liabilities may expose insurers and their boards, a risk the Prudential Regulation Authority has already identified.

New entrants supported by InsurTech will not carry many of the existing high fixed costs and legacy systems of the established players. The risk for insurers who do not develop innovative products of their own is that they struggle to differentiate themselves among a kaleidoscope of other providers.

AI and interconnectivity also present opportunities for insurers. Drones are commonly used to investigate hazardous or difficult to access loss locations. Loss scenario simulations and training can be enhanced by AI. Interconnected products can mitigate risk and present new challenges. For example, smart medical devices can deliver more targeted care and monitoring, avoiding surgery, repeat x-rays and so on.

Products which can report faults direct to their manufacturers quickly and be fixed remotely before causing potentially dangerous failures also offer scope for loss prevention -- provided manufacturers and insurers understand how to control new risks, such as cyber-attacks on connected devices.

When loss prevention isn't possible, better data also has the potential to speed up the claims process and reduce fraud risks, while also making it a smoother experience for the policyholder. Taking a holistic approach to InsurTech means insurers and their key customers take advantage of the benefits while keeping their eyes open to changing risks. InsurTech is one of the key themes highlighted in this year's DAC Beachcroft's annual Insurance Market Conditions & Trends report 2017/18.

Mathew Rutter is insurance advisory partner, and Stephen Turner, a legal director, in the global insurance team, at law firm DAC Beachcroft.

A -- AI

B -- boundaries

C -- cover

D -- drones

E -- environment

F -- failure

G -- gadgets

H -- home

I -- InsurTech

J -- juxtaposed

K -- kaleidoscope

L -- liability

M -- manufacturer n

N -- new

O -- opportunities

P -- Prudential

Q -- quickly

R -- robotics

S -- smart

T -- technology

U -- underwriting

V -- vehicles

W -- weak

X -- x-rays

Y -- year

X -- haZardous

You may also be interested in...

  • A-Z OF-¦ INSURANCE INNOVATION
  • A-Z OF-¦ Implementing best practice
  • A-Z OF-¦ CAT BONDS INCREASINGLY DOMESTICATED
Filed in:
A-Z
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Most-Popular

 

 

BECOME A MEMBER

BECOME A MEMBER

SUBSCRIBE TO PRINT

SUBSCRIBE TO PRINT
The-Journal_NEW.png
​
FOLLOW US
Twitter
Facebook
Youtube
CONTACT US
Tel: +44 (0) 20 7880 6200
Email
Advertise with us
​

About the CII

About us
Membership
Qualifications
Events

The Journal

Digital magazine
Podcasts
Blog
News

General Information

Privacy Policy
Terms & Conditions
Cookie Policy

Get in touch

Contact us
Advertise with us
Write for The Journal
Want to receive The Journal?

The Journal Magazine is © 2020 Redactive Publishing Limited

All rights reserved.