Technology taking over

Technology is growing at such a rate that it is going to radically change the world, as well as the global insurance industry. This exponential growth is building up to a change tsunami.

We have witnessed and experienced the incredible development in computing, but there are a number of other fields which are also experiencing exponential growth. These include biotechnology, networks and sensors, artificial intelligence, robotics, digital manufacturing, medicine and nanotechnology.

People tend to underestimate the impact of new technologies in the early stages because growth is almost imperceptible, but that is about to change in in a couple of important areas.

Autonomous cars

The changes predicted around the development of autonomous cars are many, and one assumption is that personal car ownership may drop dramatically. How will that impact the insurance industry?

From the disastrous beginnings for driverless cars just over a decade ago, Google now has 400 such vehicles operating in California, with almost zero accidents so far. This year, autonomous cars have also been allowed on roads in the UK and by 2020 Google and General Motors, Mercedes-Benz, Audi, Nissan, BMW, Renault and Tesla all expect to have at least partially autonomous cars on the road.

By 2032, just over 15 years away, it is forecasted that 10-million truly self-driving cars will be driving around the US alone.

The new rules of engagement

Various potentially game changing predictions around this topic include:

• Car ownership will potentially drop dramatically because people may no longer need to buy them, they will rather only call for one when they need it.
• Parking will never be a problem because once you alight, the vehicle will simply move on. This is a point for cities planning parking meter installations to consider.
• People will be able to call for cars that fit their specific trip needs, be it commuting - where they just need a single berth - or going on a road trip, where a family-sized vehicle is required.
• Electrical cars will will go and charge themselves, eliminating heavier batteries and even the current fuels industry as we know it.
• There will be far fewer accidents, meaning lower health costs, and less need for emergency services.

There will be fewer cars to insure and fewer accidents will occur. The change in ownership models will make it tricky to determine who pays for insurance. Figuring out who is liable when there is an accident, and the pointlessness of stealing a car that will drive itself home, are also likely to require changes to insurance models.

Artificial intelligence

Humans have already mastered artifical narrow intelligence (ANI) which is when a machine specialises in one area only. Car safety systems, map apps, the iPhone’s Siri and chess computers, even Google itself, are examples.

ANI does not have the capability to cause an existential threat, but Elon Musk, among others, believes that we should see this increasingly large ecosystem of ANI as a vulnerability when we get to the next categories of AI, namely Artificial General Intelligence (AGI), and Artificial Super Intelligence (ASI).

AGI will be achieved when a computer is developed that is as smart as us across the board. However, we are still very far from achieving that. For example, we are yet to build the logic that drives a robot to enable it to walk or scramble naturally over obstacles that humans can manage easily, or that can learn a language from scratch like a two-year-old does. But thousands of the world's best and smartest scientists are inching us closer to that point every month.

Famed scientist and futurist Ray Kurzweil, who has predicted the singularity – when computers become smarter than humans – believes AGI will be achieved by 2029, and ASI by 2045.