It is an interesting theme. It is even more interesting if we look at the insurance industry from a broader perspective, from the angle of economic development. Beyond issues of safety and soundness, my experience suggests that we ought to have a keen interest in the development of an effective and efficient insurance market, that serves the advancement of broader goals, from the provision of healthcare, to building resilience against natural disasters, supporting trade, enhancing social security and providing the opportunity for people to improve their livelihood. Insurance is a great invention, one of those inventions that touches people’s lives. Long before “big data” became in vogue, insurers have effectively used data to turn unknowns into knowns, and perils and hazards into opportunities. The concept of pooling funds to assist the unfortunate and those faced with adverse situations is a very noble idea. From air travel to the launching of satellites, insurance innovations have enabled many of mankind’s greatest feats, propelling civilisation forward. Innovations in micro-insurance have helped protect our most vulnerable communities from devastation. Today, drones are being used to inspect property damage claims, and machine learning to detect fraud. Indeed, the industry has enabled trade to flourish, serving as the bedrock of modern economies. Despite these remarkable developments, the world continues to face immense economic, environmental and social challenges. The effects of climate change are real, leaving horrific damage and destruction. Economic losses in the aftermath of this year’s hurricane season in the Gulf of Mexico is estimated to reach up to $ billion.

The idea here, is not to view the insurance industry’s stability in isolation, but to be seen within the wider context of preserving social and economic value of insurance systems. A new paradigm on ethics Technological advances and scientific breakthroughs have opened new possibilities to operate and deliver products to customers. Technological innovations will make customers better off but insurers on the hand, may be confronted with some fundamental ethical issues. For insurance companies, this requires a rethinking of professional and ethical standards. Thus, a need for a new paradigm on ethics. For example, with greater ability to aggregate and analyse more data from multiple sources, questions arise on the extent insurers should consider using genetic and social preferences in underwriting. Or whether it is acceptable to commit someone to a long-term financial undertaking when they may not fully comprehend the implications of their choices even though insurers might truly believe it is ‘good’ for them. And then, there is always the dilemma and trade-offs in directing more resources toward social impact investments, in cases where it lowers risk-adjusted returns for policyholders. As advancements in technology brings about various unknowns and a blurring of business lines, professional and ethical standards need to be embedded into our DNA to ensure the integrity of 3/5  BIS central bankers' speeches  our industry. When it comes to ethical values and conduct, we must move beyond conceptual discussions to practical applications. Time and effort must be undertaken to raise the standards of competence and developing well-defined codes of behaviour.