EIOPA has published its study on the use of big data analytics in motor and health insurance. It had noted a strong trend towards data-driven business models throughout the insurance value chain. Insurers have always used data-led analysis, and are now combining traditional forms of data gathering with those offered by new technologies. Nearly one third of insurers already use AI and machine-learning algorithms. In 3 years time, 65% of insurers will be using the cloud, which creates significant outsourcing concerns,
Among the notes of caution, EIOPA says that, while there is a risk that the increased granularity of risk assessment could cause exclusion problems for high-risk customers there is not yet evidence of this happening, but does think it will need to take action to address issues relating to the fairness of the use of Big Data Analytics.