Japanese insurance company makes waves by replacing staff with artificial intelligence

Author: PM editorial | Date: 11 Jan 2017

Automation also on the agenda in Singapore, where chatbots are increasingly popular in customer service roles

An insurance firm in Japan has made global headlines with its plans to replace 34 members of staff with artificial intelligence in an attempt to cut costs and increase productivity.
 
Fukoku Mutual Life Insurance is employing IBM’s Watson Explorer AI to calculate payouts to policyholders, at an initial cost of ¥200m to install and ¥15m a year to run. The employees previously handling such tasks will be made redundant by the end of March.
 
It’s a trend that is by no means isolated to Japan. Among Singapore’s start-ups and financial services businesses, chatbots are increasingly prevalent in customer service roles, where they can be programmed with a likely set of questions and answers. Instead of fielding queries by phone, the customer ‘chats’ online with the pre-programmed bot.
 
The Newpaper spoke to one Singaporean business owner - Mr Kester Poh, co-founder of online personal shopper service AskVoila - whose chatbots had even made sales.
 
"At first, we hoped the chatbots would just help us reply to customers, but it turned out that they actually sealed some deals on their own,” said Poh.
 
"From there, we started looking for ways to further develop our chatbot technology, before we realised we could make it into a business in itself.”
 
Poh now runs AiChat, a business specialising in developing chatbots for other organisations.
 
The Singaporean government has experimented with using a chatbot to help users navigate the websites of its various agencies. Called the AskJamie bot, it uses a natural language processing engine to understand the questions asked by members of the public before responding.
 
Last year, the International Labour Organization (ILO) warned that disruptive technologies could put millions of ASEAN jobs at risk from automation over the next 20 years.
 
However, at Fukoka Mutual in Japan, the machines haven’t taken over just yet: while AI bots will calculate the insurance payouts, the sums will not be paid out until a human member of staff has approved them.