Are the machines taking over?

Image by thierry ehrmann

The evolution of insurance professions as dictated by technology

New technology has always affected the way we work. From the written word to the invention of the printing press, the biggest disruptions have always been in the way we store, process and access information. Now, in a digital era, the way we manage our data is rapidly changing. For insurance, an industry dependant on data and information for its core functions, there is no avoiding the implications of the internet age.

So what does this mean for those who make their careers in insurance? Will the skills and job descriptions we value today still be relevant 10, 20, 30 years from now?

Insurance has a long, proud history of stability, tradition and trust, and there is resistance to the idea that it could work any other way. But in reality, stability, tradition and trust can exist with innovation, disruption and change.

Technology is advancing at an incredible rate, as are the effects it’s having on the professions. In the book The Future of the Professions: How Technology Will Transform the Work of Human Experts by Richard and Daniel Susskind, the authors outline four main ways in which technology is changing:

Increasingly capable machines

The capability of modern computers is above and beyond what anyone thought possible just 20 years ago. AI is becoming capable of extremely complex tasks, and the processing power we are able to harness is immense.

The massive amounts of information that we are able to store, process and act upon with computers is already changing the game, with big data becoming a necessity for the future planning of insurers.

The Future of the Professions states: “more and more tasks that once required human beings are being performed more productively, cheaply, easily, quickly, and to a higher standard by a range of systems. And there is no apparent finish line.”

The complex mathematical tasks performed by actuaries are a prime example of a task that could be mostly automated, leaving actuaries in an interesting position. How to translate their highly specialized skills into something that can’t be emulated by computers? Perhaps providing better analysis and insights from models made quickly and easily by computers, and communicating those insights in a way that supports decision making.

On the other hand, there is a common argument against technology taking over traditional jobs that require a high level of empathy and human interaction, but these limits don’t take into account what computers are actually capable of, and the potential technological advancements of the future.

Customer service has already been changed drastically with the entrance of services like robot phone marketing and online ordering, processes that no longer require the intervention of a human. There are also already advances being made in the ability for machines to manage situations that require empathy.

With technology like this, roles in claims management, customer service, and advising could become primary focuses for change.

Increasingly pervasive devices

Computers have gone from taking up the space of a warehouse to living in our pockets, on our wrists and in our cars. The mass connectedness that comes from the ‘internet of things’ means that technology is all pervasive. It also means that we expect to be able to manage more and more of our lives from our devices.

This has the effect of cutting out the middle man. Why engage an advisor if ‘robo advice’ is cheaper, easier to access, just as personalized, and works in the same way every other app you use does?

Increasingly connected humans

The internet has provided an extraordinary resource for humans to do what humans do best: communicate. The rise of information sharing over the internet means that the specialist knowledge held and sold by insurers and advisors is being repackaged and shared with personal insights amongst peers.

Online forums where users share personal experiences with buying insurance and making claims are often the first port of call for consumers looking to buy or change coverage. Price aggregators provide an immediate overview of products for perusal, and crowdsourcing advice is free.

Again, this could have a powerful effect on those in an insurance organization whose role it is to work with customers and provide advice or information.

Two possible changes

When it comes down to it, the effect of technology on the insurance professions is inevitable. The question is, how will it play out? According to Richard and David Susskind, there are two likely ways that technology could affect a profession:

Technology will help us create a more efficient version of what we have today, streamlining current ways of working using the machines to speed up processes.

Or, capable systems could completely replace the current work of professionals and change the way things are done entirely.

The highest possibility is that we experience a bit of both. To begin with, technology will be brought in to make our current work more efficient, better admin tools and faster processing to speed up our day to day capabilities. But then inevitably, bit by bit, we will have to question the way things are done. Process that evolved based on the necessity of an all-human workforce will be redesigned, and the role of the people within an insurance organization will change drastically.

The hard truth looks to be, those that remain fixated on a specific job description, and resist learning new ways of working will struggle. Those that have the ability to think about the skills that make them good at their jobs, and how those skills can make them MORE valuable in a digital workplace will do well.