CEO highlights bias in insurance | Insurance business America

When the devil is in the numbers, not just the details

Diversity and inclusion

By Desmond Devoy

The devil may be in the details, but what about the insurance bias in the numbers?

For actuaries and other workers in the insurance industry, bias is one of the topics that Jessica Leong, CEO of Octagram, hopes to explore as part of her contribution to the panel discussion “Competitive Intelligence: Market Trends and the Future of Insurance.” insurance”, in the Women in Insurance Summit at the W Chicago City Center Hotel on May 11.

While there will be a lot of “going back and forth” in the panel format, “in terms of the latest trends, I think a lot is about ESG,” he said of environment, society and governance. “On the environmental side, climate change is obviously one of those big issues. Then, on the social side, there are issues related to bias and safety. This has become something important for society and also for our regulators.”

The issue of insurance bias

Around the world, from Colorado to Europe, there are “a lot of new regulations about how insurers should test, particularly their pricing models for insurance bias, how insurers should monitor what they were doing in terms of bias and insurance models. .”

This is nothing new in the insurance industry, but it is a subject that has come into greater focus in recent years.

“You have to show that you have proven that your models are not biased,” he said.

Even if there is no deliberate bias on the part of the actuaries, for example, “there could be bias in the data,” he said. She pointed to Cathy O’Neil’s New York Times bestseller “Weapons of Math Destruction” (2016), which looked at the social impact of algorithms and how they can be used to reinforce existing inequality.

“If you google ‘nurse’, you’ll get a lot of pictures of women, right?” she asked. “Google ‘computer programmer’, you’ll get a lot of photos of men, right? So there’s just inherent bias in your data. So that could be one of the ways that bias is working its way into the system.”

Society also has to ask many difficult questions, including what questions it should ask and how they are applied.

Are women better drivers than men? If so, should they get a better rate than men?

Or if there is a ZIP code that is known to have a higher crime rate, should that mean a higher insurance rate for residents of that area? “But then, that also correlates a lot with race, right?”

For Leong, “it’s an interesting combination with the mathematical side of things, but they also talk about mathematical biases, but also about social values.”

Women in Insurance Chicago

Leong said he looks forward to being on stage in Chicago and acquired his public speaking skills through a combination of “strength and deliberate study.” She honed her skills with presentations at a previous employer and “then worked her way up to a leadership position.” She founded her own consulting firm last year, after serving as head of data and analytics for Zurich, North America, and as president of the Casualty Actuarial Society in 2021.

Leong said he looks forward to participating in this conference and the networking opportunities it offers.

“I remember one of my first post-COVID conferences. In fact, my first (post-pandemic) event was a women in insurance event,” she recalled. “I got so much energy from that. It was amazing and I made a lot of new contacts. I think when so many of us are working from home like I am, you’re working remotely, when you’re in person, it’s probably even more significant when that happens. So I’m looking forward to that.”

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