Modern Insurance Magazine Issue 65

ASSOCIATIONS ASSEMBLE
Fleur Thomas Rochester Hudd
Title: President
Title: National Technical Manager
Association: London Forum of Insurance
Association:
Lawyers
Nationwide
(FOIL)
Bodyshop Repair
Association (NBRA)
The Use of AI in
Insurance
As the use of AI in the insurance industry
rises, its benefits are becoming increasingly
clear. Insurers are now more productive and
efficient than ever before, with innovative
technologies enabling the sector to meet
changing customer expectations and provide
new solutions to emerging risks.
New ways of collating and analysing customer data
have been particularly impactful. Underwriting is more
precise, risks can be measured and priced more easily,
and claims handling is streamlined.
But the digitisation of the insurance industry doesn’t
come without legal risks. There will always be questions
about how data is being used, and how well-protected
it is against a security breach. The use of data is
something customers worry about and naturally, this
creates additional scrutiny, something that can lead
to distrust if insurers aren’t careful. Therefore, it is
important to ensure that data is being handled in the
right way. Customers will also require reassurance
through consistent communication, transparent data
policies, and adherence to regulatory requirements.
Having said that, the regulation of AI in insurance is
an issue of its own. Technology is evolving rapidly, and
it is very difficult for regulators to stay up to speed
with the changes. They’re essentially always on the
backfoot; by the time one issue has been addressed
through regulatory measures, another product appears.
These grey areas have implications from a compliance
perspective, and create additional regulatory risks for
insurers.
In response, insurers are implementing strong AI
frameworks to ensure data is being cleaned and used
in an appropriate, ethical way. Doing this will help foster
trusting relationships with consumers, and will allow
insurers to mitigate the manifest risks of AI whilst also
harnessing its full potential.
Thomas Hudd
Title: National Technical Manager
Association: National Bodyshop Repair
Association (NBRA)
Cyber Risk in the
Automotive Sector
Cyber risk in the automotive sector refers to the
vulnerabilities and potential threats associated
with the increasing integration of digital
technologies and connectivity in vehicles. As
cars become more sophisticated and connected,
they become vulnerable to cyber-attacks which
can compromise the safety, security and privacy
of drivers and passengers alike.
Some of the key aspects of cyber risk in automotive
include:
Connected Car Systems. Modern vehicles often
feature sophisticated onboard computer systems that
control various functions, such as engine management,
braking, steering, and infotainment. These systems are
increasingly connected to the internet and other external
networks, making them susceptible to hacking and
unauthorised access.
Remote Exploitation. Hackers can potentially gain
unauthorised access to a vehicle’s systems remotely,
exploiting vulnerabilities in software or through
wireless connections such as Bluetooth, Wi-Fi, or
cellular networks. Once access is gained, attackers can
manipulate various vehicle functions, potentially leading
to accidents or other dangerous situations which can
affect public trust in the safety of connected vehicles.
Data Privacy. Connected vehicles collect vast amounts
of data about their occupants, including location,
driving habits, and personal preferences. This data is
often transmitted and stored in various systems, raising
concerns about privacy and the potential for misuse if it
falls into the wrong hands.
Over-the-air (OTA) updates. While OTA updates
can provide a convenient way to patch software
vulnerabilities and add new features, they also
introduce potential risks if not implemented securely. A
compromised update mechanism could allow attackers
to install malicious software on vehicles.
To mitigate these risks, automotive manufacturers and
suppliers must adopt robust cybersecurity measures
throughout the design, development, manufacturing,
and operational phases of a vehicle’s lifecycle. This
includes implementing secure software development
practices, conducting thorough risk assessments,
implementing intrusion detection systems,
and regularly updating software to
address known vulnerabilities.
MODERN INSURANCE | 35