AI Presents Major Challenge for Digital Health and Wellness Firms Globally, Beazley Report Reveals
LONDON—Beazley, a specialist insurer, has identified artificial intelligence (AI) as the most pressing challenge for digital health and wellness firms worldwide, according to its recent report. Published under the title "Digital Health & Wellness 2024," the study surveyed 600 industry executives across Europe, North America, and Asia, shedding light on pivotal concerns as these businesses increasingly integrate AI into their operations.
A significant portion of the executives surveyed expressed apprehensions about the trustworthiness and potential biases embedded within AI systems. This issue has emerged as a top priority, overshadowing other operational challenges.
Evan Smith, Product Leader of Global Healthcare Specialty Risks at Beazley, commented on the findings, stating, “Business leaders are right to be evaluating the different challenges their firms face. For instance, while deep learning algorithms in AI hold immense potential, they are also fraught with considerable risks. The so-called 'black box' nature of AI makes it difficult to decipher how it arrives at conclusions, which in turn complicates efforts to identify and rectify biases and fully trust AI's recommendations.”
The report underscores the pressing need for businesses to secure the right insurance coverage to mitigate these risks. However, Beazley’s research indicates that less than one-third of the firms surveyed have purchased the tailored insurance necessary to protect against bodily injuries linked to technology-driven factors.
Keri Marmorek, Claims Team Leader for Healthcare at Beazley, elaborated on the dual-edged sword that is AI. “AI and other transformative technologies offer both risks and rewards. With 87% of US digital health and wellness companies planning to either implement or expand their use of AI for diagnosing or treating patients, we are likely to see a rise in related claims,” she explained. “Hence, it is crucial for businesses to collaborate with specialist insurers equipped with deep expertise in cyber and healthcare risks and a comprehensive, forward-looking perspective.”
Aside from AI, supply chain issues and recruitment challenges are also prominent concerns for digital health and wellness companies. The report notes that 29% and 28% of businesses, respectively, cite these as significant growth obstacles. Notably, this represents an increase from 2022, when only 17% and 16% identified supply chain and recruitment as primary challenges.
Looking forward, industry leaders remain particularly concerned about cyber threats and competency issues—two risks highlighted in both the 2022 and 2024 reports. However, the intensity of these concerns has grown, with competency worries topping the list for the first time. According to the report, 38% of global executives fear client backlash over perceived misrepresentations of treatment or advice competency, a notable rise from 24% in 2022. Additionally, 35% are worried about cyber threats, including ransomware and phishing attacks, up from 27% two years prior.
Despite these growing concerns, the outlook for overall business growth in 2024 appears tempered, with fewer than half of the surveyed firms expecting growth. However, this projection varies significantly by region.
Beazley’s report emphasises the need for digital health and wellness firms to remain vigilant and proactive in addressing these multifaceted challenges, particularly as they continue to embrace and integrate AI technologies within their operational frameworks.
Source: Noah Wire Services