Mobile autonomy will have a dramatic impact on industries across the world and on the way we live our daily lives. It’s predicted that there will be as many as 10 million self-driving cars on the road as soon as 2020, for example. And these exciting developments also will have profound implications for the insurance industry as risks shift and evolve.
At XL Catlin, we have entered into collaboration with Oxbotica, one of the world’s leading developers of mobile robotic autonomy software for multiple applications, to be at the forefront of this change.
Last month, we hosted an executive briefing for senior brokers at our offices in Dublin, on the topic of the impact of autonomous technology and how the insurance industry will innovate in such a new world.
We have seen automotive and technology companies making heavy investments in mobile autonomy and the technologies that make it possible. Recent years have seen significant progress in artificial intelligence, and autonomous vehicle developers have both contributed to, and benefitted from, these advances. They are now able to create powerful algorithms that can enable a vehicle to learn from its experiences and adapt to changing conditions.
Or as Professor Paul Newman, one of Oxbotica’s co-founders, puts it, “If you take our self-driving vehicle out in the snow for the first time, the autonomy software will learn and remember how to operate in snow and then keep this capability around for the next time it experiences snow.”
As these technologies mature, the market for autonomous vehicles is expected to develop quickly.
Insurers must work to understand the developments in autonomous technologies, and this is one of the reasons that we are collaborating with Oxbotica.
The implications of the so-called “robot revolution” for risk management and insurance can only be broadly imagined at present. We’re confronting a series of questions and hypotheticals instead. Who is liable when a robot’s cloud storage memory is breached, or a software error compromises performance? How do we respond to intelligent malware that can carry out criminal activities, including financial attacks?
The insurance industry has an obligation to help resolve these thorny questions, and not put a brake on technological innovation.
Working with Oxbotica gives us the opportunity to help shape the development of this technology at trial stage, help us to understand risks and opportunities, and begin to think about the risk transfer and insurance solutions that will be needed as this technology becomes more commonplace.
The data that autonomous vehicles produce can be enormously powerful – an Oxbotica driverless car produces a whopping four terabytes of data per day, Dirk Gorissen, senior engineer at Oxbotica, told attendees at our Dublin event.
In a sense this turns the car into a 24/7 risk engineer – it is gathering data all of the time.
This has huge potential for insurers’ ability to help clients with their risk management and risk transfer needs.
Following contact with Oxbotica at an XL Catlin client event on autonomous technology, London Gatwick airport engaged with both Oxbotica and XL Catlin on a project. The outcome was that later in the year, Oxbotica will run a trial of autonomous vehicles to shuttle airport staff between London Gatwick’s north and south terminals. XL Catlin will act as Oxbotica’s insurance partner for this pilot study, which is ground-breaking.
Currently, Gatwick’s 300 airside vehicles are stationary for some 90% of the time; the trial, the airports says, could lead to greater efficiency and, if successful, could see the start of more widespread use of autonomous vehicles at airports around the world.
It isn’t just driverless cars that will change the way businesses operate and humans interact with robots.
It’s expected that AI will also play a greater role in “cognitive-routine” fields like bookkeeping, inventory management and customer service. Since these require an ability to sense, learn, reason and take action, companies are likely to capitalize on the progress autonomous vehicle developers are making in AI. In the same way that Oxbotica’s vehicle technology can retain “the idea of snowy-ness,” improvements in AI – including advances in speech recognition and natural language processing – will enable customer service robots, for example, to remember the most effective solutions to different problems.
A similar trend is expected in warehouses – and there are already several distribution companies around the world that are using automated technology in their distribution centers. While these machines’ primary function is to improve efficiency via engagement in the picking and packing process, their ability to analyze and collect data from their surroundings effectively, enabling continuous risk assessment that might previously have been carried out every few weeks or months.
The insurance industry has an obligation to work alongside the development of these technologies, both to understand the risks they may present but also to contribute to their evolution and adoption.
Our aim is to be at the forefront of these changes and to help shape the future of the risk landscape – it is exciting stuff.