This short and interactive lecture will be delivered by Professor James Davey.
One of the oldest rules of English commercial law describes how companies buying insurance must share - before the contract is made - relevant information that the reasonable insurer might want to know to assess the risk. This rule was highly influential, with versions appearing in many other jurisdictions, including India, China, South Korea and the USA.
This goes against the normal expectations of commercial negotiations: that each party can keep private any information that it possesses. We have 250 years of case law that show what marine insurers normally do (and do not) need to know about the ship or goods to be insured. We can therefore predict with some confidence what human insurers need to be told. But the growth of AI informed underwriting disrupts these expectations. Machine learning promises dynamic risk assessment based on thousands of factors. This raises the prospect of the 'reasonable algorithm' replacing the 'reasonable underwriter'. This lecture considers the likely impact of that change on marine insurance at a global scale.