opportunities

DAC Beachcroft published a report with more than 160 predictions across the entire spectrum of insurance risks and Future he echoed, replicating it in his place. Environmental, social and governance (ESG) issues remain a dominant focus in the sector, but the report highlights that data, artificial intelligence (AI) and regulation are areas where the insurance industry must focus its attention in the near future. term.

Helen Faulkner

“Our growing reliance on data has brought ethical considerations to the forefront and placed greater responsibility on organizations to manage it responsibly and address the moral challenges posed by its use,” said Helen Faulkner, global head of insurance. from the desktop.

“We hope that governments and regulators will adopt more measures and guidance on the regulation and management of AI. “While recent events have highlighted differences in the approach to AI regulation around the world, despite the challenges this divergence poses, the opportunities on the horizon for the insurance industry are enormous,” he concludes. .

Predictions

The predictions of the firm are grouped into six themes: collective lawsuits, climate change, global risks, modernization of the workspace, regulation and technology and AI.

Likewise, within the technology and AI section, the report makes a series of predictions in up to 15 segments: #1 aviation #2 insurance #3 data, privacy and cyber #4 managers and financial institutions #5 education #6 insurance advice # 7 maritime, energy and transportation #8 medical malpractice #9 motor #10 political risk and trade credit #11 safety, liability and product recalls #12 professional liability #13 property #14 reinsurance #15 transactional liability.

Data, privacy and cybersecurity

Data ethics takes on a crucial role in guiding the use of personal and non-personal data

Organizations are expected to implement an ethical approach by codifying it into a formal governance framework. This framework would not only determine whether data can be used, but also whether it should be used. Ethical considerations around data use are increasingly relevant, especially with the rapid advancement of artificial intelligence. Although these considerations are not new, the increasing reliance on data places greater responsibility on organizations to ethically handle data and address the moral challenges associated with its use.

UK to adjust pro-innovation approach to AI regulation

It is anticipated that the Government and regulators will implement additional measures and guidance to manage AI risks, either by updating existing regulatory frameworks or implementing new measures. Despite the previous pro-innovation stance, mounting pressure, including a report from the Science, Innovation and Technology Committee, urged the Government to take a more balanced approach and accelerate the implementation of a governance regime for AI.

The creation of the Artificial Intelligence Safety Institute is a first step in this direction, supported by the Bletchley Declaration which advocates for AI safety internationally. Organizations interested in incorporating AI into their operations should stay informed about these regulatory developments.

More roles for regulators to address AI

Regulators such as the Financial Conduct Authority and the Competition and Markets Authority will expand their traditional roles to address the regulation of artificial intelligence (AI) and digital technologies. In collaboration with the Office of the Information Commissioner, these regulators will play more prominent roles and are establishing the DRCF AI and Digital Hub, a multi-regulatory sandbox, to facilitate compliance with regulatory requirements in digital technologies.

Cooperation between regulators, evidenced in the Digital Regulation Cooperation Forum, will be strengthened to address the challenges posed by AI, according to the Science, Innovation and Technology Committee’s interim report.

IoT and new risks

Legislation on connected products poses new risks for insurers of manufacturers and distributors. A debate is anticipated in the insurance sector about whether the risks associated with this legislation should be covered by existing cyber risk, product liability, technological errors and omissions policies, or whether they justify the creation of a new type of insurance.

Starting in April 2024, the Telecommunications Product and Infrastructure Security Act will impose stricter security requirements on connected consumer products. Manufacturers, importers and distributors will be required to comply with these regulations and penalties for non-compliance will include significant fines. The recoverability of these fines through insurance policies will be subject to specific conditions and legal questions, creating new challenges for insurers in determining appropriate coverage.

Accumulation of demands

An increase in small-claims breach claims is expected, especially in data breach cases. Despite clear directions from the courts to assign these claims to the small claims track, plaintiffs’ representatives will attempt to circumvent this assignment to claim recoverable costs.

The filing of data breach claims such as personal injury claims is observed, avoiding the small claims portal and the fixed cost regime. Furthermore, the trend of stacking claims into a single form seeks to overcome the threshold of the small claims track, circumventing group litigation mechanisms. Uncertainty persists about the suitability of these avenues for such claims, and future rulings are expected to provide greater clarity in this regard.

Follow us on the networks:

LinkedIn:

Twitter:

Facebook:

YouTube:

2024-01-31 18:14:07
#DAC #Beachcroft #great #opportunities #insurance #data