February 2024 Newsletter: Finally, AI
Artificial intelligence is here. Well, it's been here. But, we're ready to talk about it. Check out Embroker's February 2024 newsletter to hear all about it.
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Get a QuoteWe are in our AI era. And by we, we mean WE. All of us.
Artificial intelligence is here, and here to say. Granted, not in all the ways we may have expected.
Robotic bees to help pollinate crops? Check. AI perfumers? Check. AI toothbrush? Check. An AI-powered robotic fry station? You bet. Slapping AI on any and everything to get some attention seems to be the name of the game. Honestly, do we really need artificial intelligence to tell us what emotions our dogs are feeling? Between that and Bunny the Dog’s existential crisis, maybe it’s time we leave our furry friends in the peaceful bliss of ignorance for a little longer.
There’s a lot of excitement about what AI offers businesses, though: increased efficiencies, cost savings, and improved productivity, just to name a few. The technology definitely can and will provide those benefits when used properly. Properly.
Because while AI brings plenty of opportunities for businesses, it also brings plenty of risk, particularly when implemented without oversight, guardrails, or policies in place.
Since it seems like everyone else has already weighed in on it, we thought it was time that we delved into what’s at stake with AI and what business owners need to be aware of for responsible usage (aka, not getting sued). So buckle in because there’s a lot to cover.
Let’s get into it.
- What’s Going On?
- How AI Will Upend Everything (And Then Some)
- AI and Small Business: Friend or Foe?
- What’s New from Embroker
What’s Going On?
Generative A.I.’s Biggest Impact Will Be in Banking and Tech, Report Says — The New York Times
A new report highlights the need for workers to prepare for how AI could play a substantial role in future workplaces. And in the tech sector, that means people could be designing and building their AI replacements. Sounds like an employment practices claim waiting to happen.
In Big Tech’s Backyard, California Lawmaker Unveils Landmark AI Bill — The Washington Post
A state lawmaker in California has introduced a bill that would mandate companies releasing AI models to test new tools for “unsafe” behaviors, implement hacking protections, and design the tool so that it can be completely shut down. The landmark bill could inspire regulation elsewhere around the country, leading more businesses get Cyber Liability insurance policies.
Another NY Lawyer Faces Discipline After AI Chatbot Invented Case Citation — Reuters
We’ve been here before. A New York lawyer is facing possible discipline for citing a nonexistent case generated by AI. It’s another reminder that generative AI may be handy, but it’s definitely not perfect. Legal malpractice insurance may not cover that.
AI Could Make the Four-Day Workweek Inevitable — BBC
Being paid for five days a week but working four? Yes, please. Some experts believe the accelerated pace of AI in the workplace will make this more of a reality.
‘Disinformation on Steroids’: Is the US Prepared for AI’s Influence on the Election? — The Guardian
There are many concerns about AI’s influence on this year’s election. And for good reason. Already this year, AI was used to create deepfake calls purporting to be President Joe Biden that targeted New Hampshire voters in the January primary, telling them to stay home. It’s going to be a turbulent road to the ballot box.
How AI Will Upend Everything (And Then Some)
Oh, boy, will it ever.
Embroker’s Chief Insurance Officer, David Derigiotis, was a recent guest on White House Chronicle to chat about all things AI. The program has aired on PBS since 1990, and has been hosted by Llewellyn King for its entire run.
When it came to AI, there was a lot to talk about. As David explained: “AI brings a whole new era … it will impact everything we do personally as well as professionally.”
The discussion ran the gamut of AI topics – touching on everything from the trouble with deepfakes and cybersecurity to the increasing IQ of AI models, entrusting the tools for systems management, and impacts on our culture.
One of the main concerns with AI has been its colossal rise, something that is unlike anything we’ve ever seen in the history of technological advancements, including the internet. During the discussion, David pointed out that the speed of AI’s evolution and adoption has led to valid questions about where the data these tools are accessing is coming from and how the models are being trained. The New York Times’ lawsuit against OpenAI and Microsoft has also brought up the issues of copyright, compensation, and intellectual property with the data that AI systems access.
“There are huge benefits [AI can] provide, but you need to understand the reasoning that’s going on behind the curtain, and we just don’t know,” said David.
Of course, every industry is feeling the impact of AI, and the insurance sector is no different. David explained that Embroker is currently employing artificial intelligence to help assess risk and provide real-time tailored insurance programs to customers. AI provides the opportunity to quickly produce the exact policy, limits, and type of coverage a particular customer requires based on their risk profile.
On the issue of risk, David noted that it’s essential for businesses adopting AI to be mindful and proactive regarding the new risks associated with AI and implement procedures and products necessary for addressing those risks.
“Artificial intelligence is certainly an emerging area and companies need to think about what liabilities they have as it relates to the use and dependence on those tools,” David explained, noting how Samsung last year banned its employees from using generative AI tools after sensitive internal source code was uploaded to ChatGPT.
Though many questions and concerns need to be addressed as AI continues to evolve, David highlighted that it’s still important for businesses to embrace and adopt these tools.
“I don’t think we should put our head in the sand and just think it’s a fad that will pass by. People will wake up one day and they will see that they’re out of a job or they’ll see that they’re not as capable as some peers may be around them,” he explained. “It’s not just going to be AI that replaces jobs. It’s going to be people using AI replacing other people.”
AI and Small Business: Friend or Foe?
Artificial Intelligence Poses Risk to HR Practices
Google “How can AI help my business?” and you’ll easily get a few million results. There are numerous ways that AI can help businesses improve productivity and efficiency, like idea generation, editing, and reviewing documents. Not that we would know anything about that…
But – and this is a big but – unfettered access to this emerging technology can pose significant problems, not to mention financial and legal repercussions.
In fact, even companies producing AI models highlight the need to verify everything (seriously, everything) the tools produce. In a Washington Post article, Kristina Behr, Vice President of Product Management for Collaboration Apps at Google Workspace, said, “I don’t want people to abdicate responsibility. This helps you do your job. It doesn’t do your job.”
One issue that’s captured headlines lately is biased results from AI tools. Discrimination by AI tools in screening job applicants is a prime example. Many had hoped that the use of AI would help end or at least alleviate bias in the recruiting process, but there’s growing concern that the opposite is happening. It’s an issue that has already garnered attention from Congress, federal regulators, and some state legislators.
The bias found in AI programs is shining a bright spotlight on the need for ongoing human oversight, to double-check the output of these tools, and the issue of becoming over-reliant and complacent with them. Because in instances when discrimination is perceived, there’s a good chance employers could find themselves liable.
Of course, unintended bias isn’t the only risk businesses face with AI. Our 2023 Cyber Risk Index Report found that while AI is not a top priority among founders, it is their top concern. “Malicious AI” tied for first with “attacks against suppliers/partners” (each with 37%) as the leading cybersecurity threats for survey respondents. And with the rise of deepfakes and other AI-powered technology, nine out of ten founders believe malicious AI is a threat to their business.
It all comes down to a crucial balancing act for businesses utilizing AI: Does it bring new opportunities? Absolutely. Does it also bring new risks that are still being discovered? Without question. The crux is having plans and tools, like proper insurance coverage, in place to navigate those risks in order to fully realize and benefit from the advantages of AI.
In an article for Built In, David Derigiotis (have you heard of him?) wrote that embracing responsible AI practices is not just about minimizing risks; it’s also a way to unlock untapped opportunities. “As the AI journey unfolds, we can mitigate the new risks it poses with responsible integration, paving the way for innovation like never before.”
What’s New from Embroker?
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