Shining a Light: Using AI to Transform the Insurance Sector

Read what the members of our network have to say about the challenges of the past and opportunities of the future in the Insurance Sector.

AI for Services is a UK wide network bringing together AI & Data high growth entrepreneurs with leading professionals and academics working in the high professional services sectors.

This month we interviewed two of its member organisations, distriBind and Insurtechnix, that were successful in securing an Innovate UK grant through the Industrial Strategy Next Generation Services Challenge Programme. Using Artificial Intelligence and Data technologies, they have both developed solutions to improve the insurance sector by increasing data visibility and tasks automation. We asked them about their projects, their motivations and what the future of the sector holds.

distriBind – The Future of Delegated Authority

distriBind is a platform to deliver bordereaux-free Delegated Authority. The platform uses AI to automate the validation, reconciliation and enrichment of risk, premium and claims data in delegated authority. Innovate UK grant funding has supported the development of the AI-led premium and capacity forecasting. The solution now gives Managing General Agents (MGAS) and carriers a continuous view of capacity utilisation across their binders and underwriting teams.

We interviewed Dave Connors, CEO of distriBind.

Why was your project developed? What was the inspiration and aim?

I have a lot of experience in Insurance and in Delegated Authority in particular. I have seen at first hand the problems throughout the value chain caused by bordereaux: delay, error and costs resulting from poor data quality and control. distriBind is conceived to deliver Bordereaux-free Delegated Authority while also for those who can’t avoid bordereaux in the short term, delivering a more efficient and elegant process.

What have been the challenges so far? How did you overcome them?

There have obviously been significant technological challenges in the conception of the platform and the algorithms underpinning it, and then development. From a business development point of view the challenge is to persuade prospects of the reasons why “more of the same” isn’t the answer and to do something different, and of course to take a chance on a start-up. We have overcome the technical challenges with robust and clear internal processes and strong communication to provide clarity around what we are seeking to achieve. Business Development challenges we have sought to overcome through developing a partner network and we have seen the fruits of that.

What does the future look like?

Increased automation is definitely the future. This is not about “robots taking your job”, this is using Machine Learning and Robotic Process Automation (RPA) to allow “good data” to flow through seamlessly and to highlight errata. The algorithms and robots will support knowledge workers, delivering actionable insights and allowing rigorous and granular interrogation of data.

Insurtechnix – Disrupting the Cybersecurity Insurance Market

InsurTechnix develops and commercialises innovative technologies for cyber insurers. Innovate UK grant funding supported the development of CyberSentinel, a cyber protection product for SMEs that collects risk data from business devices. By applying AI techniques to this data, Insurtechnix enables UK insurers to better price cyber risk premiums and reward good cyber risk management.

We interviewed Fiona Kinghorn, Co-Founder and CEO of Insurtechnix.

Why was your project developed? What was the inspiration and aim?

We wanted to solve a double edged problem, SMEs are particularly vulnerable to cyber risks and this has only increased with working from home. We wanted to give them a simple tool to help them manage risk and at the same time provide cyber insurers with data to better price cyber policies.

What have been the challenges so far? How did you overcome them?

Developing the technology with limited funding and resources solved by founder sweat equity, grant funding and angel investors. There is a massive market opportunity but the slow sales cycles in the insurance market is a continuous challenge and decision speed has not been helped by the virus. We’re cherry picking immediate revenue opportunities outside the insurance sector through direct sales and our channel partners.

What does the future look like?

The long term future looks great. But I think the next few months are going to be very bumpy. Fortunately the team has previous experience of recessions in both 2000 and 2008. There’s going to be a dearth of equity investors for quite a while. We are exploring numerous alternative funding sources and have cut all non-essential costs to extend our runway. On the other hand, we have never been busier. Increased working from home has highlighted SME cyber vulnerabilities and the need for our CyberSentinel.

Fiona gave us five simple steps that can help significantly reduce working from home cyber risks during the Covid-19 confinement:

1. Immediately implement a policy that all employees verify any email instruction purporting to come from a colleague by phone before implementing the instruction. This particularly applies to instructions for money transfer.
2. Instruct all employees to undertake basic cyber security training. The UK Government provides a good introduction, available here.
3. As a priority, apply multi-factor authentication to as many applications as possible.
4. System back-ups are a crucial business continuity measure. A good backup strategy starts with an exhaustive audit of all sources and stores of business data. Test back-ups regularly to be certain they can be relied upon. Given the threat of ransomware, consider how long it will take for backup solution to restore all the business’s devices. When employees work from home it is essential that you check your backup systems are still protecting them.
5. Identify employees using administrative privileges and decide how best to minimise the use of such privileges. While engineering or R&D teams may need to use administrative privileges, high risk employees such as customer facing accounts, support and marketing employees should not. Executives are at particular risk as they are spear phishing targets.