Insights on Data, Disruptions, and the Future of Finance in India Unveiled at the 23rd Global Conference of Actuaries on Day Two

The 2nd day of the conference had a power packed line up of Senior Government functionaries and International delegates from diverse domains which included Mr. K. Rajaraman, Chairman, International Financial Services Centres Authority (IFSCA), Ms. Deepti Gaur Mukerjee, Chief Executive Officer, National Health Authority (NHA), Dr. Tarun Agarwal, Director, National Insurance Academy, Mr. Charles Cowling, President, International Actuarial Association (IAA), Mr. Srinath Sridharan, Author, CEO Coach, Family Business Transformation Advisor, Independent Director, Media Columnist and Mr. Nilesh Shah, CEO, Kotak Mahindra AMC & Part time member of the Economic Advisory Council to the PM, India.

The Institute of Actuaries of India, established under The Actuaries Act 2006, kicked off the 23rd Global Conference of Actuaries (23rd GCA) in Mumbai on February 13-14, 2024. Themed "Data, Disruptions, and the Actuary," the event convened experts from the insurance, pension, and finance sectors worldwide to discuss the influence of technology and artificial intelligence on India's financial services industry, with a focus on insurance.

Mr. Arunachalam, President, Institute of Actuaries of India opened Day 2 with a recap of proceedings of the inaugural day. "As we kick start another eventful day featuring esteemed speakers, let us reflect upon the substantial opportunities awaiting actuaries within the evolving realms of the insurance and banking sectors. Looking back at the discussions held on the inaugural day, it is visibly clear that research and innovation are sine qua non. India has immense capacity to become a significant hub for actuaries, both nationally and internationally." Additionally, he emphasized the significance of two Memorandums of Understanding (MOUs) signed in previous years with IFSCA GIFT CITY and the National Health Authority, illustrating how actuaries can contribute to advancing development in the finance and insurance sectors.

Soon after, the keynote address by Mr. K. Rajaraman, Chairman, International Financial Services Centres Authority (IFSCA), delved into topics such as financial inclusion, significance of actuaries in the insurance sector, and utilization of AI and ML in risk management for actuaries. He remarked, "The journey of improving financial inclusion spanning over the last 70 years has been remarkable, uplifting 500-600 million people who previously lacked access to insurance, banking, and pension products." He highlighted the pivotal role of digital infrastructure in this progress, citing initiatives like Jan Dhan, which brought 14 million previously unbanked individuals into the financial mainstream and facilitated their ability to save 2 lakh crore rupees in the past 5 years. Additionally, he noted the increase in bank credit across various sectors, including retail, MSMEs, and large corporations. Mr. K Rajaraman underscored the crucial role of actuarial science in the insurance segment, stating, "In the future, AI and ML in insurance can bring about a transformative shift in the end-to-end insurance process. For instance, Neural networks can detect anomalies, while natural language processing can enhance the underwriting process for actuaries, leading to superior risk management."

Ms. Deepti Gaur Mukerjee, Chief Executive Officer, National Health Authority (NHA), India, addressed the issue of Bridging the Health Insurance Gap, stating, "Ensuring health security for all is paramount, particularly in a densely populated country like India, where insurance coverage remains low, especially among the bottom 40% of our population, comprising 12 crore families and 65 crore individuals." She emphasized the role of Ayushman Bharat, the largest publicly funded initiative, in pioneering innovative solutions such as introducing advanced treatments, ensuring transparency, and integrating cutting-edge technology into healthcare packages to address this disparity. Ms. Gaur Mukherjee stressed the importance of not only providing health security but also economic security, stating, "Through collaborative efforts between the government and private sectors, we are leveraging a network of hospitals nationwide to ensure affordable healthcare for all." Additionally, she highlighted the launch of the National Health Claims Exchange, in partnership with IRDAI, aimed at streamlining the insurance process through a digitalized system, thereby reducing claim cycle time to just 90 days.

Mr. Charles Cowling, President, International Actuarial Association (IAA) and Mr. Srinath Sridharan, Author, CEO Coach, Family Business Transformation Advisor, Independent Director, Media Columnist, India shared their insights during the session titled "The AI Arms Race." Mr. Cowling discussed "The prevalent belief that AI may replace actuaries, emphasizing that actuaries, when empowered by AI, hold the potential to revolutionize and positively impact the industry". Mr. Sridharan highlighted the numerous use cases and benefits of AI, asserting that human intelligence can surpass artificial intelligence. The session concluded with the acknowledgment that while AI is indispensable, in an era characterized by the proliferation of quantum computing and other advanced technologies, achieving an appropriate balance between AI sophistication and prudent caution is imperative.

At the event, the Institute of Actuaries of India collaborated with the India Insurtech Association and PricewaterhouseCooper (PwC) to unveil the White Paper titled "Exploring Alternative Data Sources in the Insurance Industry." This comprehensive whitepaper investigates alternative data sources applicable to the insurance sector, examining various use cases, confronting challenges, and presenting a structured framework with potential solutions tailored for industry stakeholders.

In the last session of the event on Investment lessons from the Great Epics, Mr. Nilesh Shah, CEO, Kotak Mahindra AMC and part-time member of the Economic Advisory Council to PM, India initiated his session with a striking quote from Warren Buffett, underscoring the nuanced value of money: "Money is not everything. Make sure you earn a lot before speaking about money." With astute analogies drawn from Indian scriptures, Mr. Shah evoked the character of Duryodhana to elucidate his point that within each of us, there exists a propensity akin to Duryodhana's, hindering prudent investment despite understanding its significance. Moreover, he talked about the essence of long-term investment, cautioning against the pitfalls of succumbing to greed and fear. Mr. Shah further highlighted the role of financial advisors, likening their guidance to the sagacious counsel provided by Saarthi, such as Krishna from the Mahabharata. Ultimately, he emphasized that investment is fundamentally an exercise in common sense, that needs discipline and informed decision-making in the market.

About The Institute of Actuaries of India (IAI):

The Institute of Actuaries of India (IAI) is a statutory body established by an Act of Parliament, viz. The Actuaries Act, 2006 for regulating the profession of Actuaries in India. The nodal ministry for the Institute is Department of Financial Services, Ministry of Finance. The office of the Institute is located at Seawoods, Navi Mumbai.