×
First-time login tip: If you're a REBA Member, you'll need to reset your password the first time you login.
27 Mar 2019
by Tracey Ward

Five ways AI will reshape reward in the future

Artificial Intelligence (AI) could transform the employee benefits universe over the next 10 to 15 years.

986E-1553076677_AIshapingrewardMAIN.jpg

Changes we may see coming in as the technology advances include employers using data to target their benefits spending, and providers creating tailored packages to fit individual employer’s needs. 

Portman Wills, Chief Technology Officer at fintech benefit provider Wagestream, said: “There is no doubt the already significant impact of big data analysis on the employee benefits sector will grow as the technology evolves.”

Data avalanche 
Increasingly sophisticated AI technology is not the only driver for change, however. The massive take-up of connected consumer devices such as smartphones and fitness trackers also represent a key element.

According to data analyst Statista, there are already more than 23 billion connected devices in use around the world. And by 2020, this total is expected to jump to about 50 billion, providing AI systems with an avalanche of data to analyse.

“The biggest trigger is the volume of data available,” Wills added. “We all generate data everywhere we go.”

Reshaping benefits
Here are five ways we believe AI will use this data deluge to reshape how employee benefits are delivered in the future:

  1. Providing tailored benefits packages for individual employers 
    One of AI’s main virtues when it comes to employee benefits is that it allows employers to really understand what their workforce wants for the very first time.

    For providers, it also offers an opportunity to tailor packages to each company’s individual needs.

    “AI enables more accurate support to be made to employers,” Wills said. “Right down to which local gym is most popular with its employees.”

    He does not believe companies will use AI to personalise benefits for individual employees, though, especially not SMEs.

    “Most SMEs want to offer benefits as uniformly as possible for simplicity and cost effectiveness,” Wills added.

    “So I can’t see them micro-targeting their offerings, just using the data to get a lot smarter about what they offer as a whole.”

  2. Helping companies to streamline their benefits spending 
    Modern employers recognise the importance of offering a comprehensive package of benefits to their staff. However, they are also keen to avoid wasting money on benefits with low take-up.

    Jeanette Makings, Head of Financial Education at financial benefit provider Close Brothers, said: “From an employer perspective, there is already a lot more emphasis on looking at data to see what benefits employees are using.

    “This allows them to make better decisions, meaning they can tailor their benefits spend while improving employee engagement.”

    Zoe Eccleston, Employee Benefits Director at health benefits provider Babylon, agrees that AI technology can help companies to make the right choices. “Babylon’s AI platform provides insightful, aggregated employee health information that businesses can use to make data-driven decisions on wellbeing strategies,” she said.

  3. Predicting workforce health and wellbeing needs
    At present, AI is mostly used to analyse existing internal employee benefits data. In the future, however, it could also be used to make meaningful predictions by factoring in external trends such as longer life expectancy.

    This potential to “predict and prevent” rather than react is one reason why 80 per cent of the insurance executives who took part in Accenture’s Technology Vision for Insurance 2018 report said they expected AI to take on a collaborative role within their organisations by 2020.

    And it could result in further efficiencies for employers.

    If, for example, an employee agrees to wear a smartwatch that is connected to an insurer’s actuarial database, the data collected could be used to predict that employee’s personal risk based on his or her daily activities – potentially reducing the cost of cover.

  4. Informing business strategy
    In years to come, AI may also be used to decide business strategy on a grander scale. Say a company was considering increasing its headcount in Sweden by 10 per cent.

    The impact on medical costs would be one factor it would want to take into account before making a decision.

    Next-generation AI technology could calculate an accurate response using data on trends such as insurance premium hikes, thereby influencing where and when a business places its workforce.

    “There are already companies offering predictive AI that can help businesses such as restaurant chains to decide how many staff they need on a certain day based on both historic internal data and external factors such as the weather forecast,” Wills said.

    “It definitely feels like a sea change is under way.”

  5. Reducing the administrative burden
    There is no doubt that AI technology can analyse large swathes of data a lot more quickly than a person. Advocates of the technology also claim it is more reliable and can spot anomalies that might easily be missed by a human analyst.

    “I think we will see more technology being used at an employer and provider level to take the weight out of doing the analysis,” Makings said.

    That’s not to say AI will – or should – replace humans, though. Rather that it offers companies an exciting new way to avoid wasting money and time.

The author is Tracey Ward, Head of Business Development and Marketing, Generali UK Employee Benefits

This article is provided by Generali UK. 

In partnership with Generali UK Branch

Generali UK provides insurance solutions to the UK employees of multinational clients.

Contact us today