Munich Re says data analytics and use of algorithms offer huge potential for the insurance industry, creating new risk protection solutions and improving customer outcomes.

The reinsurer is looking to step up its knowhow in these areas, collaborating with leading research institutions such as the German Research Centre for Artificial Intelligence to complement its work in complex topics like quantum computing.

It has also recently set up the Quantum Technology & Application Consortium together with nine leading German companies.

The goal is to tap the tremendous potential of quantum computing for the insurance industry.

“The digitalisation megatrend will radically change traditional insurance,” Munich Re Board Member Torsten Jeworrek said. “It will give rise to new fields of risk in need of insurance solutions.

“With its numerous digital and innovation projects, Munich Re has laid the foundations for profitable growth going forward.”

Munich Re says data-based algorithms help to optimise many processes such as customer interaction, claims settlement and underwriting.

The reinsurer says it also is aiming to increase its 10% share of the cyber market. It intends to achieve the goal by expanding its network and partnerships and tap the use of technologies to improve its expertise in modelling digital risks.

“In collaboration with clients, solutions are being drafted that go far beyond traditional approaches and comprise not only customised cyber coverage but also services to prevent and cope with attacks (also referred to as pre- and post-incident services),” Munich Re said.

“The inclusion in insurance covers of such consulting services geared to limiting losses is becoming increasingly important, particularly given the growing number of ransomware attacks.

“This will raise cyber security standards and make risks more insurable.”