IUA survey shows insurers covering emerging technologies

More than half of companies polled in a new International Underwriting Association (IUA) survey are already providing insurance for devices linked to the ‘Internet of Things’ and unmanned aerial vehicles (UAVs). The research showed how London Market companies are developing new products to cover emerging technologies, with around 30% of firms already insuring smart medical devices and artificial intelligence.

A total of 20 companies were represented in the survey, conducted by the IUA’s Developing Technology Monitoring Group (DTMG). The results show the extent of coverage has expanded significantly since a similar poll was conducted in 2018. The proportion of firms offering policies for autonomous vessels, for example, has risen fourfold.

Tom Hughes, secretary of the DTMG, said: “Emerging technologies can present a real challenge for insurers due to a lack of historic data upon which to base risk assessments. The results of our survey, however, show that many firms are stepping up to this challenge, working with clients and technology providers to develop effective solutions.”

A total of ten different emerging technologies were identified in the IUA’s research, including electronic sports, virtual and augmented reality, e-scooters and cryptocurrency. The majority of insurance products currently offered were found to cover commercial use of the technology, but several products have also been developed to support their testing.

In addition, on-demand insurance solutions are available for seven of the ten technologies surveyed, confirming that companies are reviewing their distribution channels in light of evolving exposures. When asked about systemic risks, respondents identified the Internet of Things, artificial intelligence, smart medical devices, autonomous vehicles and cryptocurrency as posing the biggest threats.

Few emerging technologies are thought to have effective regulatory frameworks currently in place to support their future use. Seven out of ten technologies listed saw less than 30% of respondents agreeing that regulation is adequate. Only UAVs, esports and smart medical devises recorded scores of around 50%. In addition to regulation, the availability of trusted data for risk assessment and public perception of risk were cited as key obstacles limiting the development and adoption of new technologies.

Over the past week the IUA has hosted a daily series of seminars, exploring new risks and opportunities associated with the evolving technologies identified in the survey. The DTMG conference concluded today (9 March) with a panel debate involving expert speakers from client, legal and underwriting backgrounds.