(Re)in Summary
- SRA’s handbook sets out a five-stage process for assessing how cedants’ use of AI affects underwriting, claims and portfolio exposure.
- The guide highlights concentration risk when several cedants rely on the same third-party model.
- SRA’s technical and legal and compliance subcommittees developed the handbook to complement Singapore’s MindForge AI Risk Management Toolkit.
The Singapore Reinsurers’ Association (SRA) has issued guidance on how the growing use of artificial intelligence across insurance underwriting and claims processes could alter the risks assumed by reinsurers.
The Reinsurers’ Artificial Intelligence Handbook sets out a five-stage assessment cycle for underwriting, claims and risk teams. It also identifies third-party dependencies and portfolio concentration risks as areas of focus. If several cedants rely on the same AI model, for example, a flaw in that model could affect more than one book of business.
The handbook also covers underwriting, claims and the reliability of the data, models and decisions on which cedants rely.
“Reinsurers need to understand how AI use may affect risk selection, claims outcomes and portfolio performance, and what that means for the risks they reinsure,” said Glen Riddell, chair of the SRA.
Insurers in the region already use AI in some of those decisions. In South Korea, AIA said its AI-assisted claims process cut processing times for some claims from more than two days to under 25 minutes, allowing assessors to focus on more complex cases.
In Singapore, Manulife said it tests its AI models before deployment and sets accuracy standards for tools that support underwriters. Staff interpret the results and make the final decisions.
Members of the SRA’s technical and legal and compliance subcommittees developed the handbook to complement existing AI governance frameworks, including the MindForge AI Risk Management Toolkit.
The association launched the handbook on 2 November at the 22nd Singapore International Reinsurance Conference, which drew more than 4,200 delegates from 85 countries and territories ahead of the year-end renewal season.
