CES 2018 Trending: Insuring the Smart New World
For the past seven years now, I’ve made an annual pilgrimage to CES in Las Vegas to learn all about the latest research in technology and how it is being integrated into new consumer products. Understanding how technology makes our lives better is integral to understanding the rapidly evolving nature of human behaviour. It is also critical for the insurance industry to understand these trends because it will shape the future of how customers will think of insurance. This article explores key trends in technology as unveiled at CES 2018 and the opportunity for the insurance industry to embrace these trends to their advantage.
Capture & Use of Data Increasing
An ingredient technology for any major innovation in 2018 and beyond is going to be data. Data is becoming a resource like electricity. But unlike most resources, data is expanding and can grow indefinitely.
According to Brian Krzanich, Intel’s CEO during his CES keynote, “Data is going to introduce social and economic changes that we only see once or twice in a century. It is time to think about the importance of data differently.” This new perspective is necessary he said, because “almost everything we associate with technology generates data.” Krzanich predicts that by 2020 the average person will create 1.2 gigabytes of data per day. In addition, an autonomous vehicle will generate 4 terabytes a day while a smart factory will generate 1 petabyte (1024 terabytes) of data per day.
New Immersive Realities
Steve Koenig, senior research director at the Consumer Technology Association, predicts that virtual and augmented reality technology will be greatly enhanced to redefine realism in 2018. Again, the capture and processing of enormous amounts of data will make this happen.
This past year, Facebook launched Facebook Spaces in beta. Using the Oculus Rift virtual reality (VR) glasses, you can communicate in the virtual world with your friends, and even share photos and play card games.
Intel is looking to take augmented reality (AR) and VR to new heights through volumetric video capture. They want to capture scenes far beyond the traditional 3D pictures you stitch together in VR by recording the volume and depth of a picture too. This will give you the sense of actually being inside the movie. Imagine if you did this for the Super Bowl. You would literally see from the perspective of the quarterback as he throws the winning touchdown. Basically, a series of volumetric cameras are placed all around the football field and absolutely everything is recorded. This past fall, the company launched Intel Studios. It is the world’s largest volumetric video capture and production facility in the world. In addition, they will be working with media partners to capture volumetric video at this year’s winter Olympics.
Immersive reality will facilitate new realms of human connection via digital means. Not only will the insurance industry adopt buy online and chat bots as a way of servicing customers, but insurance providers will also be able to communicate with customers in new realities created with AR and VR. It would be possible to integrate these technologies (AR and VR) throughout the entire customer journey; a journey that could also include risk, claims and medical assessments as well as sales and service. Just like the picture above where two people are sharing Facebook photos in VR, you’ll be able to interact with objects and other forms of information while communicating with your customers.
Autonomous Car Developments
The race to develop working autonomous car technology has really accelerated as presented at this year’s CES. Hardware makers like Intel and Nvidia are making chipsets dedicated to the requirements of autonomous driving including the ability to connect 5G networks, render and process high definition maps, and neural processing for artificial intelligence.
At CES, Lyft and Aptiv are examples of how invested ridesharing companies are in developing autonomous cars. Lyft was offering rides in Las Vegas using Aptiv’s autonomous vehicles. Implementation in ridesharing programs could be the catalyst that gives instant adoption and scale for autonomous vehicles.
Another major progress to note is the company called HERE. They make high definition maps that contain LIDAR (which stands for Light Detection and Ranging) information so autonomous vehicles have awareness of objects and road conditions. At CES, a number of partnerships were presented indicating the importance and progress in high definition map technology. They have partnerships with Intel, Pioneer, DJI, BMW, Audi and Nvidia.
The discussions around smart cities is a huge trend at CES this year. Why is that? According to the Consumer Technology Association, 70% of the world’s population will live in cities by 2050. This poses a huge challenge for transportation, pollution, and security.
Shown: Smart Cities Panel from Left to Right, Nick Bowden, EIR, Sidewalk Labs; Adam Blake, CEO, Zego; Lesa Mitchell, MD, Techstars Kanas City; Rodney Williams, CEO, LISNR; Nagesh Rao, Chief Technologist, SBA
A panel on this topic was staged at Eureka Park at CES where they showcased 1,000 startup companies. Representation on this panel included Sidewalk Labs, the Alphabet Company building the Toronto smart city. They prefer not to use the term “smart city” but rather “city operating system”. The mandate is to develop technology along with new regulations and policy so that the new operating system can solve the challenges of urbanization.
There are challenges with transforming an existing city with these new ideas. There are challenges with government, policy, regulation and transforming an existing urban area while keeping existing services and traffic running. This is one reason why Sidewalk Labs is working with the City of Toronto to transform Toronto’s Quay Side which is currently unused to start testing smart city ideas and operating systems.
Insurance Shifts to Manage New Risks
AIG is one of the very few insurance companies that regularly participate at CES. They are part of the forward-thinking conversation that takes place each year and they integrate the insurance mindset into the talks to facilitate the management of risk as new technologies, like autonomous vehicles to smart city operating systems, emerge.
Rex Baugh, CEO of North America General Insurance for AIG, and Gaurav Garg, CEO for AIG’s Personal Insurance Business, hosted a panel discussion and the topic was “Who’s Responsible for Driverless Car Liabilities and Risks?” They opened the discussion by introducing some work they’ve collaborated on to determine the consumer perception around the future of mobility and where they think the risk lies. AIG surveyed 1,000 driver-aged people in the U.S., 400 in Singapore, and 400 in the United Kingdom to gauge public attitudes toward autonomous cars as this will likely shape how regulators respond.
Consumers were surveyed about their perception of fault when riding in the driverless car, and a lot of the liability was perceived to now fall on the likes of the:
• car manufacturer
• software developers who develop the “brains” of the car
• manufacturers of the sensors, cameras and traditional car parts
• companies that develop and maintain roadways used for autonomous cars
• companies that develop the infrastructure that allows vehicle-to-vehicle communications
• suppliers of mapping systems and data
Companies are already preparing for this shift. Car makers such as Volvo, Mercedes-Benz and even Google have made public that if their commercially available vehicle that’s being operated in autonomous mode is at fault for a collision, they would take liability and responsibility.
The AIG survey also included asking consumers about their sentiment on driverless cars. In the U.S. and U.K., 42% of those polled said they were comfortable with sharing the road with driverless cars, while in Singapore 46% were comfortable. Similarly, Canadian insurance comparison website, Kanetix.ca conducted a similar survey recently and got similar results with 41% of Canadians indicating they were comfortable with the idea of driverless cars.
Our world is about to get super smart and it all starts with the applications and conveniences we can build with the data that is being collected. The global insurance industry needs to pay careful attention and CES is one way for us to stay in touch and in tune with what’s going on. It’s essential to stay abreast of technology trends and the resulting change in consumer behaviours to help with the management of risk as the world transforms. It’s an opportunity just waiting to be seized.
As President & CEO of Kanetix.ca, Andrew Lo leads all digital innovation and operations for Kanetix Ltd., Canada’s largest digital customer acquisition platform for insurance and financial services.