By the 1990s, telecommunications companies were creating virtual private network (VPN) services on surplus network bandwidth, allowing companies to host their own software and data centers. Telecommunications companies realized that they could provide the new private network connections far cheaper but with the same quality of service as their old point-to-point data offerings. This improvement on the shared mainframe approach enabled a communication and data revolution by enabling multiple computing environments on a single physical system. In the 1970s, the major hardware and software vendors began using virtual machines as a way of providing independent, multiple platforms and operating systems on a host server. Pestcoe expects that boards, senior management, and insurance solution providers will collaborate closely to address the issues and mitigate risks.The term "cloud computing" came into widespread use in the mid-2000s, but its heritage can be traced to a number of computing business models beginning in the 1960s that enabled customers to purchase computing time on large mainframe computers rather than buying the hardware and software themselves. The new GAI and LLM tools further heighten these existing issues. Without an emphasis on trust, some insurers will lose their customers’ confidence. If data is biased, analytic results will be biased and improper use will occur in the absence of control. Pestcoe closes his remarks by highlighting three main areas of risk in analytics – bias, control and trust. – to own information technology issues and not hand them off to back-office technical experts. Second, boards will expect senior managers – CEOs, COOs, CROs, etc.They will challenge management to present the business implications of information technology issues clearly enough so that boards can weigh in with informed decisions. First, boards will expect more thorough briefings from management on IT issues.The importance of analytics across the insurance enterprise will cause boards to change their approach to information technology issues, Pestcoe predicts. Marvin Pestcoe, Board member, Hamilton Insurance and Catalina InsuranceĪs new approaches such as machine learning became available, they were seen as “nothing new here.” Pestcoe observes that he has seen boards give too much deference to technical experts and encourages board members to challenge technicians to adopt new approaches. It's not enough anymore for an insurance company to just focus on underwriting, legal and audit. You simply need to have members of the board who do have technology expertise. His surprising reason is that insurers became entrenched in traditional techniques and tools because they were early adopters of analytics. One of the inhibitors for analytics in insurance is that, for many insurers, analytics has been “shunted off into the back room.” Pestcoe does not believe that analytics has received as much focus at the board level as warranted for something critical to an insurer’s success. Defer to technical experts at your own risk Learn ways that your insurance organization can stay resilient amid these changes. Related: Adjusting to disruption and uncertainty in insurance has become the norm. Pestcoe is hopeful that the attention around new AI tools will help raise the discussion of analytics in general. These need to be better mined for their full value. Since GAI and LLMs aren’t new, many underutilized tools and techniques are already in the market that are proven, tested and effective. He hopes this attention translates into a renewed focus on analytics. Pestcoe confirms that GAI is a top issue for insurance company boards of directors. Three of his main points are summarized below. His thoughts provide a roadmap for insurance leadership. In the wake of the excitement around generative artificial intelligence (GAI), ChatGPT and large language models (LLM), Pestcoe positioned these new tools against his past experiences of how advanced insurers have implemented analytics. Marvin Pestcoe, FCAS, Board Member, Hamilton Insurance, Board Member, Catalina Insurance In short, he understands the connection between analytics, AI and insurance organizational success. He is a fellow of the Casualty Actuarial Society. Marvin Pestcoe serves on the boards of Hamilton Insurance and Catalina Insurance. As insurance continues to evolve, the link between analytics, AI and organizational success has never been more apparent.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |