FUTURE OF ROBO-ADVISORS IN LIFE INSURANCE SECTOR

Abstract

The aim of this article is to indicate the most important issues related to the use of robo-advisors in life insurance as well as the future directions of development for such technology. This elaboration has utilized a review of professional literature, including industry-related materials and case studies. In October 2018, upon the implementation of the EU Insurance Distribution Directive (IDD), which governs the distribution methods of insurance, the financial sector loudly commented on the risk of financial advisors being replaced by virtual advisors (also referred to as robo-advisors), i.e. bots based on technologies that use artificial intelligence. In this article, an attempt has been made to answer the question whether it is possible for artificial intelligence, in the nearest future, to replace human insurance advisors in the customer consultancy process. Due to the complex nature of the process, the considerations have acknowledged the regulatory, social and cultural challenges, since all of them have a direct impact on the shape of the market. Because of the limited length of the article, the subject has been presented only from the perspective of financial advisors. Another limitation is caused by the fact that data regarding innovations and sales are confidential, and they are well-protected by enterprises. Thus, access to detailed statistics is very limited, especially with regard to specific sectors and products of financial companies.