Keeping pace with accelerating tech

Published on Mon, 10/05/2021 - 10:10

Risk and insurance professionals will need to keep pace with the current period of innovation, with a raft of new technologies seeing accelerated implementation as a result of the pandemic.

The pandemic has accelerated the rollout of emerging tech, bringing forward years of digital transformation to within a matter of months, as businesses have scrambled to survive.

These emerging technologies have the power to transform the working environment but are also shifting the risk landscape, emphasises Julian David, CEO of digital technology member association techUK.

David addressed Airmic’s live-streamed Technology Forum event on 13 May, with a keynote speech focused on the effects of disruptive technology as companies emerge from the pandemic.

“Every business is now a digital business, in terms of the skills within the organisation,” he tells Airmic News. “If you thought you were an insurance company or a bank, or a construction firm or a manufacturer, regardless, you’re now also a digital company.”

“The tech sector is always innovating and therefore driving industries, including risk and insurance, to keep pace,” he continues. “The challenge for risk management and the insurance sector is that struggle to keep pace with innovation and therefore meet customer expectation.”

For the insurance sector, he explains, a list of emerging technologies are taking shape: artificial intelligence (AI); automation; geospatial data; quantum computing; crypto-blockchain; and digital identity technologies.

“Underpinning this is the convergence of three technology essentials – everything intelligent, everything connected, everything analysed,” says David.

Getting the deployment of technology right will depend on skills and resources. Organisations need to have the right talent in place to allow them to take advantage of innovations, but also to manage the opportunities and risks associated with them.

“The issue is how to ensure you have access to those skills. That could mean you grow them in-house or buy from a trusted partner. It’s a huge issue, when you bear in mind that companies are paying such high salaries for even relatively inexperienced data science specialists,” says David.

“Have you thought about looking outside your own sector. Innovation and disruption can happen really fast and insidiously, sweeping through one industry and then suddenly it’s in your industry.”

Recruiting the skills required for emerging technologies has the potential to change the DNA of firms, across different industry sectors, he explains. AI in particular will put software at the heart of companies’ operations to a degree previously unseen, he suggests.

“Everyone thinks about the implications of technology in terms of our jobs and our work balance, but from a risk management point of view how do you calculate and quantify and manage software-based processes?” he asks.

Legal and regulatory risk are added to this new cocktail, with a raft of regulation aimed at taming new technological frontiers set to become a lot more relevant to businesses keen to embrace them.

“There’s an awful lot of legislation coming into this space now,” he says. “If you look at the EU’s position on data protection and machine learning-based activities, it will have a real impact on data gathering and the use of data. Questions will emerge, for example, about how do you factor and manage bias.”

Data security questions from regulators are becoming more pressing, he suggests, the more automation and AI is in place within organisations.

“As you automate more and more and base decisions on data, how do you ensure the security of data?” he asks. “We have to continue to earn the trust of stakeholders, whether that’s customers, employees, investors or regulators. How can you be sure nobody is able to attack your operation and disrupt your business by denying you access to your data?”

Looking further ahead, quantum computing technology will have profound security implications for businesses and their consumers, David warns.

“In Apocalyptic terms, it could mean that every encryption tool you have is no longer any use, because quantum has such massively powerful computing power that it invalidates it,” he says, adding: “Apocalyptic statements in tech generally don’t come about, but sometimes they do.”

About techUK

With more than 850 members, techUK is a trade association bringing together people, companies and organisations to realise the positive outcomes of what digital technology can achieve.

Drawing together companies of all shapes and sizes from a range of sectors, the majority of its members are small- and medium-sized enterprises from the UK, to create a network for innovation and collaboration across business, government and stakeholders to provide a better future for people, society, the economy and the planet.

By providing expertise and insight, the association seeks to support its members, partners and stakeholders as they prepare the UK for what comes next in a constantly changing world.