Artificial intelligence (AI) has probably been the major benefactor in the growth of the Fourth Industrial Revolution. Creating computers that can think like a human and carry out menial human tasks speaks to innovation and the way that technology is improving the way we interact with our world.
Big Data is another major driver and is a key component in the development of AI. The financial services industry, insurance, in particular, are major users of Big Data.
We will be focusing on both of these issues in this post.
There was a time when the world was concerned about the rise in robotics saying that the robots will eventually replace humans. It has taken a while to get to this point, but every major technology company, from Amazon to Microsoft is now using AI as a critical business function.
A lot of the major advancements in AI comes from Asia which is arguably the most technologically advanced continent in the world. So what is the development of AI looking like in the world’s technology breadbasket?
An article on enterpriseinnovation.net shows that AI development in Asia is significant.
The article points out that the AI debate is being driven by the popularity is driven primarily by the fact that a) the amount of data that is freely available has increased drastically over the past years – data that is essential for training systems – and b) the hardware is available, performant and cost effective.
The cost of graphic processing units (GPUs) with platforms like NVIDIA has allowed entry level AI solutions to be developed at a reasonable cost. Combine that with the general broader application of open source and cloud based technology adoption, you have a cocktail that is favourable to technologies such as AI.
Interacting with other humans, as well as the world around us, has been heavily influenced by AI and by social media. Predictive analytics allows companies to tailor messages to suit individuals based on their browsing history as well as historical discussions on social networks.
Chatbots have also been major benefactors of the growth of AI, but is this the extent of the future development of this?
The article points out that Chatbots are actually rather basic applications of machine translation, AI based or not. Far more advanced applications are looking into behavioural models and predicting culture, as well as using speech-to-text and text-to-speech combined with advanced predictive models for a range of applications.
The article adds that one of the examples is using AI for machine translation. LexisNexis’s latest translation project was to translate 500 billion words of content from English to Japanese, Chinese, Korean and German. This project is scheduled to completed in just 6 weeks, while Facebook would take 5 years to translate the same volumes of content.
AI is also being adopted among e-commerce provider. Amazon’s and Lazada’s product catalogue data are some of the most complex content types to process. Before being translated, there are a number of AI processes and models that are used to analyse, improve and control the source content.
The article adds that AI can also be applied for fraud detection. Traditionally fraud detection primarily focused on the analysis of numeric data and transactional information. Considerable research effort has been applied in recent years to the analysis of the language used in official documents, such as annual reports and is delivering a surprising level of accuracy via the analysis of the text and the way information is expressed within a document. True positive rates are further enhanced when language and data analysis are combined using an ensemble approach.
As pointed out earlier, the insurance industry is a major user of Big Data, which is a major driver of AI.
InsurTechs like Lemonade, and Trov, have really disrupted the marketplace or at least created a perception of disruption. This is just the tip of the iceberg, but not in the sense that you might think. InsurTech are the tip, they are a visible part of the insurance industries technology stacks.
Just like an iceberg, the real power of InurTech lies under the water. We have seen many InsurTech start-ups fail because they have no way of taking their disruptive distribution models and efficiently plugging that data into the carriers back-end systems.
Another thing to consider is hype vs impact. There is a lot of hype about many new tech start-ups, but what impact do they truly have on the traditional industry? A good question to ask your IT departments is: if we want to plug into Lemonade, could we?
The South African insurance industry has a long legacy of being at the forefront of innovation on the African continent. However, is it innovative when it comes to worldwide standards?
This is, unfortunately, a yes/no situation. We have seen some of the insurers really embracing certain technologies and are leaps and bounds ahead of many of the foreign insurers we engage with, especially in the telematics space. We are behind the curve on data switching and especially on distribution.
IT vendors like to talk mobile apps, we hear it all the time. The problem is not getting the customers to use the apps, the problem is that many legacy systems cannot consume the information generated by the mobile apps, so it offers no real value and is then discarded. We also do not see enough true online multi-quoting platforms.
Unemployment is currently the biggest challenge that South Africa faces at the moment. Yet, the technology industry has created far more jobs than any other, particularly in insurance.
Simply put, cross-skilling, not fearing the change and staying up to date with technology trends. Many jobs that are around today did not exist 10 years ago. Who could have imagined social media experts, BigData Architects, iOS Developers or even Uber drivers a decade ago? Many jobs that exist today might not be around in a few years, but many new ones will be created. Who knows, maybe some start-up will write a system tool that is designed to write insurance systems and I will be looking for a new job type in a few years.
One of the features of the growing influence of technology in our everyday lives is the development of augmented reality (AR). Have a look at our latest blog on this.