AI and Insurance

Insurance, to me and many others, is a guarantee for safety and financial stability in times of dire need. For example, a few months ago my wife and I got into a decent car wreck in town and our car was totaled by another driver. With that other person being at full fault in the accident, we got around $7,000 in money from our insurance on my wife’s car, which meant that we could shop and get another vehicle quickly.

However, insurance is and has been used as a Weapon of Math Destruction, as described by Cathy O’Niel in her book Weapons of Math Destruction. She writes how many of the statistical problems with insurance is the fact that race has been a big factor in figuring out who gets insurance policies. What occurs is a negative feedback loop, where the black communities are at an initial disadvantage, and then from this it gets worse since they cannot receive the insurance they need. From here, it gets worse in that community, therefore the loop exists.

What people need to do to solve this is to keep insurance algorithms and companies in check. This “insurance” against insurance will insure people’s safety and stability in rough times. To me, what should be changed is that we should remodel our insurance policies to avoid old and racist policies.

To me, the biggest takeaway from this chapter is the fact that insurance models have been separating and grouping people based on color for over a hundred years, and we have not really noticed it fully until now. This service needs to be changed, and the fact that we as a people have not done anything is disappointing to me. From here we need to be more equal for all, since everyone deserves some kind of security in the case of an accident.