Actuaries to seize AI potential following NAICOM chief’s call

Cynthia Ezekwe

A call by Olusegun Omosehin, Nigeria’s insurance commissioner and chief executive officer of National Insurance Commission (NAICOM), is spurring actuaries operating in the Nigerian insurance market to investigate and seize the potential on offer by artificial intelligence (AI).

Omosehin’s call came as the insurance industry continues to grapple with the intricate challenges of a rapidly evolving landscape, for which he thinks actuaries should seize the potential of Artificial Intelligence (AI) as a transformative force that can improve operational efficiency and drive sustainable growth in the industry. 

According to Omosehin, AI presents a game-changing opportunity for the insurance industry, and it is imperative for actuaries to integrate it into their work, thereby enhancing their capabilities and securing the long-term success of the industry.

Actuaries are seasoned risk management professionals who leverage advanced analytical techniques to evaluate potential risks and opportunities, enabling businesses, government agencies, non-profit organisations, and individuals to make informed decisions for the future. By employing their expertise in innovative problem-solving, actuaries help these organisations and individuals to minimise potential risks and maximise long-term growth.

The call to embrace AI comes as the insurance industry faces increasing pressure to innovate and adapt to changing customer needs, technological advancements, and evolving regulatory requirements.

Speaking at  the 2024 Nigerian Actuarial Society (NAS) annual industry conference tagged “Actuaries and AI: Strengths, Opportunities, Weaknesses, and Threats,’’ the NAICOM CEO  stressed the need for the profession to leverage AI and other emerging technologies to stay relevant in a rapidly evolving industry. Omosehin noted that AI has the potential to revolutionise the way actuaries work, enabling them to provide more accurate risk assessments, better pricing, and more effective capital management.

The commissioner, who was represented by Usman Jankara, deputy commissioner,  finance and administration, highlighted the ongoing technological revolution that is reshaping the world, with a particular emphasis on the financial sector. Jankara underlined the imminent and groundbreaking impact of Artificial Intelligence (AI), which is expected to significantly transform the way businesses operate.

Omosehin submitted that the Nigerian insurance industry is undergoing a significant transformation, and that the integration of actuarial science with AI provides a promising avenue to further leverage technology for the industry’s continued growth and success. According to Jankara, actuaries can become key players in shaping the future of the industry and facilitating business expansion by harnessing the power of AI and utilising it to improve data analysis, decision-making, and overall operational efficiency.

“Today, actuaries play a critical role in risk assessment, pricing, and financial stability using advanced techniques such as data science and predictive analytics to analyse complex data and make informed decisions.The profession has become increasingly important in a data-driven world, with actuaries in high demand across various economic sectors.

“It is therefore exciting to witness conversations around AI especially since the release of Chat-GPT in 2022 which was followed by other AI Chatbots and other technologies to integrate these advancements to improve operational efficiency. It is in recognition of these developments that the federal government of Nigeria plans to position Nigeria as the AI hub for AI solutions in Africa. This is to be achieved through the development and implementation of a National Artificial Intelligence Strategy aimed at accelerating AI adoption in Nigeria,’’ the NAICOM chief noted.

Omosehin strongly encouraged all stakeholders and actuaries in the insurance industry to adopt and capitalise on AI technology, positioning themselves as pioneers in the evolving field. He reinforced NAICOM’s commitment to align its sectoral regulatory policies with the federal government’s overall strategy while maintaining the stability and strength of the Nigerian Insurance Industry.

While there are concerns that disruptive technologies like AI might replace jobs and render skills obsolete, the NAICOM boss noted that  historical patterns reveal  that technological advancements have always transformed the job landscape and required new skill sets.

According to the NAICOM CEO, AI has the potential to revolutionise the insurance industry and the actuarial profession, stressing the need for  actuaries to  adapt and develop skills that leverage AI and machine learning tools to remain relevant.

“The rapid evolution of AI means that continuous learning and development are essential to avoid being left behind. The Nigerian Actuarial Society plays a crucial role in equipping its members with the necessary skills to navigate the AI era, which is why this conference is timely and necessary,’’ he noted.

Omosehin also highlighted the importance of data-driven decision-making, stressing that AI can help actuaries uncover insights and patterns that may not be apparent through traditional methods.