Beware IoT’s regulatory blind spots, says Lloyd’sNovember 22 2018 by InsuranceAsia News Staff
According to a report from Lloyd’s, the range and quality of security standards for the Internet of Things (IoT) will make it harder for insurers to make risk assessments.
The report states there are critical blind spots in the regulation and legislation of IoT devices and their impacts; these include uncertainties surrounding attribution and liability should anything go wrong.
Dr Trevor Maynard, head of innovation for Lloyd’s, commented: “Insurers should play a role in shaping the IoT landscape and Lloyd’s has proposed several options from leading on data standardisation to working with governments and tech companies.
“Insurers should proactively talk with clients to review and assess all risks associated with the Internet of Things to provide them with advice on best practice and appropriate risk solutions, thereby shaping the development of the IoT ecosystem in which they operate.”
However, there are positives from the IoT revolution for insurers. The report says it will lead to data capture and management at an unprecedented scale; this could mean better risk assessment and more flexible, bespoke and real-time products. It may also increase policyholder concerns about the use and accuracy of their data.
According to the report, interconnectivity will create business models where more is known about insureds, bespoke policies are generated in real-time and fraudulent claims are recognised quicker. The ability to create personalised policies will enable insurers to more accurately predict and mitigate risks.
Networked World: Risks and Opportunities in the Internet of Things was published in collaboration with University College London’s Department of Science, Technology, Engineering and Public Policy and the PETRAS Internet of Things Research Hub, analysed the impact of the IOT on the insurance sector.
IoT is an explanation for connected devices transferring data.
- January 10
Lloyd's coverholder Pegasus to help Beazley develop a portfolio in the SAR.
- January 2
Reinsurer's acquisition will provide global reach to accelerate growth.
- December 20
The European Commission has approved the reinsurer's bid for the the Lloyd's insurer.
- December 18
Iain Ferguson will take up both roles as Lloyd's restructures in the region.