Risk Design: AI and Prediction Beyond Screening in Insurance Markets -- by Alex Chan

2026-07-09 · Source: National Bureau of Economic Research Working Papers · Field: Finance & Economics — Insurance & Risk Management, FinTech & Digital Financial Services, Economic Analysis & Policy · Depth: Expert, quick

Summary

A research paper by Alex Chan, titled "Risk Design: AI and Prediction Beyond Screening in Insurance Markets," is featured by the National Bureau of Economic Research (NBER). This work likely investigates the transformative potential of artificial intelligence in the insurance industry, moving beyond conventional risk screening methods. It suggests an exploration into how AI can be utilized for more sophisticated risk assessment, innovative product design, and the restructuring of insurance markets. The NBER, a leading non-profit economic research organization, hosts this paper within its broader research findings, which include topics on the economics of AI and digitization, and insurance market design.

Key takeaway

For insurance product managers and actuaries exploring advanced analytics, this research highlights AI's capacity to redefine risk management. You should consider how AI can move beyond simple risk identification to actively design new insurance products and market structures. Focus on leveraging AI to create more nuanced risk pools or develop highly customized policies, rather than just optimizing existing screening protocols.

Key insights

AI can fundamentally reshape insurance risk design and prediction, moving beyond traditional screening paradigms.

Principles

• AI extends insurance prediction beyond basic screening.
• Risk design can be actively shaped by AI capabilities.

In practice

• Evaluate AI for dynamic insurance product development.
• Investigate AI's role in personalized risk pricing.

Topics

• AI in Insurance
• Risk Design
• Predictive Analytics
• Insurance Markets
• Economic Research
• NBER

Best for: AI Scientist, Research Scientist, Director of AI/ML

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Editorial summary, takeaway, and curation by AIssential. Original article published by National Bureau of Economic Research Working Papers.