GFIA has today published its response to a consultation by the International Association of Insurance Supervisors (IAIS) on insurers’ use of big data analytics (BDA).
While welcoming the over-all balance provided in the consultation, GFIA said the IAIS should recognise the benefits of insurers’ use of BDA more explicitly. GFIA added that many of the possible risks discussed in the consultation, such as biases resulting in discrimination and reduction of access to insurance, lack evidence and may in any case actually be mitigated by the use of BDA.
On the point of accuracy, GFIA noted that algorithms are able to take in more information, which de-emphasises the reliance on any one data point and should actually improve accuracy. GFIA also noted that some of the supervisory concerns mentioned in the paper, such as industry consolidation, non-compulsory insurance products and the issues surrounding genetic data, are not BDA specific concerns.
Moreover, GFIA said that the supervisory concerns mentioned in the paper can, and are being, addressed under existing supervisory standards.