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Machine Learning and Insurance: Don’t Run and Hide

Robert Regis Hyle | August 11, 2015

Celent’s latest report on (pick your favorite term) artificial intelligence, machine learning, or cognitive computing, is a reminder that fantasy-land is more than just dreams and imagination. When I spoke to co-author Mike Fitzgerald about the report last week, I came clean: “I have a hard enough time understanding the technology we are using today, much less what we need to prepare for tomorrow.”

The one thing that was easy for me to understand about “Machine Intelligence in Insurance,” which Fitzgerald wrote with Craig Beattie, is such tools are closer to reality than we might think.

Granted, Fitzgerald has more than a passing interest in the subject, but he predicted that within five years there will be as much discussion about machine intelligence in insurance as there is today about cloud computing.

That statement alone should make us stand up and take notice. IBM first piqued interest with its release of Watson and the promotion the company pushed to have the machine take on and defeat the two most successful champions in the history of the game show Jeopardy.

That took place over four years ago, though, which seems like the 20th century in terms of technology breakthroughs. Watson isn’t alone in the market today, although Fitzgerald believes IBM continues to do most of the heavy lifting in the promotion of artificial intelligence.

Fitzgerald understands why it is easy for insurers to block out AI from their less than artificial minds: the debate currently is meaningless to most business executives and any plans to use machine intelligence will likely show up first in industries other than insurance, which certainly isn’t shocking to anyone.

Thankfully, some insurers are sick of the “slow adopter” moniker and realize that while artificial intelligence might not be in the insurance mainstream for a while, it will impact IT professionals who do choose to work in insurance.

It is hard to escape the doom and gloom that comes when people scream as loud as they can that computers are taking over the world. There is no doubt that machine learning will bring great changes to the world, just as a half-dozen other innovations have done over the last decade, but wise people look at threats as opportunities and that’s what insurers need to focus on. As Michael Corleone once said, “Keep your friends close and your enemies closer.”

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