So is insurance an art or a science?
Strange question, but it’s hardly above the towering ego of a CEO to nod in the direction of Einstein and Picasso when discussing insurance business strategy.
Let’s put it differently: what the correct balance is between capital and labour? Or, because we always start with 100% labour: can a computer program do this stuff profitably?
Wearingly, the answer is: sometimes.
People, relative to computers, are good at at identifying when another person is making an error or trying to mislead/screw you. Let’s be generous and call this insight artistic.
Computers are good at crunching through datasets in a scalable and standardized way. This would be the ‘science’ of insurance.
Now, there are instances when the artist is needed more than the scientist. How can this be? Well, insurance isn’t so monolithic as it may seem because different lines of businesses need different combinations of skills.
So, if the answer is ‘both’, then are the opportunities better for artistic lines or scientific lines of business?
Good question, let’s look into that shall we?