Speaker(s): Kenichi Nogami (Accenture)
Long term guarantee is very dangerous risk and most expensive factors of risk and capital management. More theoretical, more precise risk model may require more risk capital. For instance, long term care cost can be significant in decreasing population countries as Japan, Germany and Korea, because elder care service cost shall be provided by less populated young people in future for more populated elder people, who have longer lifetime especially longer lifetime of cared people.
But Artificial Intelligence may mitigate long term care risk, by reducing elder care service cost by providing automated care service. Additionally, medical science may reduce incident rate of care. Many valuation and risk management actuary will not accept these possibilities in artificial intelligence and medical science, and they require pricing actuary more expensive pricing. Lower / negative interest rate promotes more conservative pricing.
For new entrant to long term insurance industry and asset management advisor and personal financial advisor, this environment is very attractive. Expensive pricing and unsatisfied consumers are incubator of disruptive new entrant in all industries. Consumer who concerns about long term care risk shall purchase new service rather than very expensive price offered by existing industries.
This paper will discuss the lifetime digital butler who provide best advice for personal risk management, personal health care management personal financial management and personal asset management.