The potential benefits of artificial intelligence (AI) are immense. Swiss Re has written extensively on how AI and generative AI will likely be transformative within the insurance industry.
Wherever there are opportunities, there are also risks. And artificial intelligence (AI), like any technology, can go wrong. AI may fail against performance benchmarks; it may inadvertently perpetuate discrimination; it could be subject to malicious attack; or it will perhaps cause real world damages.
The study looks at emerging AI risks across 10 industries in the next decade, exploring the probability and severity of various AI-related loss incidents, due to six risk categories that include data bias, cyber incidents, algorithmic and performance-related risks, among others. In which industries are AI risks more concentrated, and where could they become more prevalent with time?
Health and pharmaceuticals industry could be the hardest hit by the adverse effects of artificial intelligence (AI) over the next decade. As the health industry increasingly uses AI technology to streamline functions such as administration, patient monitoring, diagnosis, and drug development, the risks are also rising, and consequences can be serious or even fatal. For instance, flawed or biased AI algorithms could result in misdiagnosis, leading to serious illness or loss of life.
The study also reveals that while IT services are currently the most affected by AI risks as a pioneer in this area, this is set to change as the use of technology becomes more widespread across all industries.
The role of the insurance industry is to support our clients manage AI-related risks, in part with new risk protection products and partly through our existing lines of business. Providing AI risk solutions is a significant opportunity for the industry. Insurance companies are already starting to introduce specific cover for AI performance failures – one of the biggest risks for all industries.
Download and read the publication to better understand the AI risks landscape, how it may play out across industry lines, and how re/insurers could shape their business offerings accordingly.