I thought I'd try something different this week: a series of shorter items rather than a longer exquisition. That's partly because I found a whole series of items worth pointing out but also because I need to note the news that sparked my headline about how insurers are taking over the world:
The stadium where my beloved Pittsburgh Steelers play will, after 21 years, no longer be called Heinz Field, after the local corporate food icon, and will instead be named after Acrisure, an insurance brokerage based in Grand Rapids, Michigan, that bought the naming rights.
I had held out hope that the stadium would some day be named Hines Field, after longtime Steeler wide receiver Hines Ward, who, in my not-so-humble opinion, needs to be in the Hall of Fame, but I defer to the power of the insurance industry.
Now, on to some developments on: how drones are being used to inspect power lines; how electric vehicles are reaching a tipping point that could have major implications for auto insurers; the arrival of a new generation of "digital assistants"; why insurance customers may cut spending; and how embedded insurance is providing what Swiss Re calls a "second act to insurtech."
Autonomous Drones Inspecting Power Lines
An article in Wired describes how drones are being used to take a look at pylons in the U.K. electric grid to spot issues that could, among many other things, cause wildfires. Crucially, these drones are autonomous. They don't have to be maneuvered by an operator. And they can be controlled from anywhere -- the operator, who can handle a fleet of drones at the same time, doesn't need to be out in the field. The drones remove the need for workers to climb towers to conduct inspections (time-consuming and dangerous) and allow for photos to be taken much closer up than is possible with helicopters at a small fraction of the cost.
While the article focuses on the U.K., it also describes early uses in Florida, Norway and Sweden.
As a resident of California, which seems to have become the wildfire capital of the world, I'm all for anything that will reduce that risk.
Electric Vehicles Have Reached a Tipping Point
An analysis by Bloomberg finds that electric cars in the U.S. has passed a tipping point: accounting for more than 5% of new car sales. "If the U.S. follows the trend established by 18 countries that came before it," the article says, "a quarter of new car sales could be electric by the end of 2025. That would be a year or two ahead of most major forecasts."
Such a swift switch would have wide repercussions. Car makers, already retooling to build more electric vehicles, would need to accelerate the changes in their factories, supply chains, work forces, sales forces and more. EVs need less maintenance than cars with internal combustion engines (many fewer moving parts), so those that service cars will see business diminish.
Insurers will, as usual, have to adapt to the new realities of all those businesses and individuals they insure. They will also have to deal with the fact that EVs are more expensive to repair -- and will likely widen the difference with conventional cars because the massive batteries will be able to power many more (delicate and expensive) sensors and safety devices.
The change will also create uncertainty as the ground shifts in such a major industry. Who knows, all the new EVs flooding the market might even affect a certain individual who made most of his record-breaking fortune with an EV named after a Serbian-American inventor and who may or may not buy Twitter.
New Generation of "Digital Assistants"
I've been a skeptic about digital assistants ever since tech types started geeking out about them three decades or more ago. No, I don't want my refrigerator ordering milk for me. I can buy milk all on my very own, thank you very much. Now, we're in business if, while I'm in a store, the refrigerator can tell me how much is left in the carton and that I not only have cilantro but that it hasn't melted into mush in my produce drawer. But the vision for "assistants" has really been about devices that would take control, so they missed on two counts: They didn't know enough to actually be able to take control of my whole refrigerator, let alone of more complicated parts of my life, and I didn't want to give up control even if they did know enough.
But a kinder, general, less obtrusive generation of digital assistants may be on its way. A Fortune newsletter quotes one of the AI developers as saying, “If you had another person on your team, what would you shamelessly ask them to do? That’s what we want this software to do.”
In a demonstration that a developer has posted online, the article says, "software uses a basic SQL database to perform a variety of tasks. A user types 'can you grab the name and population for every country?' and the software goes ahead and pulls that data from the database and assembles it in a simple table. Then a user asks the software to 'make a bar plot of that,' and the software does so. But the plot is hard to read because it contains too many countries. So the user asks it to just 'to show the countries with the six highest populations,' and the software comes right back with a much easier-to-read chart. This time, though, the labels for the six countries are overlapping, which still isn’t great. So the user types, 'Good. But the x axis is still a bit hard to read, can you fix that?' And remarkably, the software does so—by writing the labels on an angle—even though the feedback from the user was not that specific. Later in the demo, the software grabs publicly available U.S. unemployment figures from the internet and charts those."
Don't add a digital assistant to your Christmas list just yet. I've been promised one repeatedly since the late 1980s. But these kinds of digital assistants should be available in some form in a few years -- and I'd actually use one.
Will Customers Cut Spending?
Just a quick data point here for those interested: A Guidewire survey found that:
"With most people (86%) concerned about the cost-of-living crisis, many are considering how to cut back. For almost half of insurance customers (48%), that will be insurance cover that they are not legally obliged to have. Policies likely to get the chop are cover for travel (18%), home contents (17%), and bicycles (16%)."
Embedded Insurance and a "Second Act to Insurtech"
Another pointer for those interested: A rich look at the prospects for embedded insurance, based on a conversation between Sebastien Bert, co-head of strategic partnerships for the Americas at Swiss Re, and Carrier Management.
If you've made it this far and have an opinion on this week's use of short items, whether good or ill, please let me know.
In the meantime, I'll be commiserating with my fellow Yinzers about the loss of an iconic name on the Steelers' stadium while assuring those I know that insurance brokerages are good people, too.
I do worry that Pittsburgh fans will have trouble pronouncing Acrisure while screaming at their TVs in the fourth quarter of a nail-biter, after perhaps one or two too many Iron City beers, but that should be the least of our worries this year, now that we have no idea if our quarterback will be any good. Don't get me started....
Cheers,
Paul