Quantum computing: a new horizon for insurance

Quantum computing is an emerging branch of IT that uses the principles of quantum mechanics to process information in way that is radically different from traditional computers. While traditional computers use bits to represent data such as 0 or 1, quantum computers use qubits, which can be in multiple states simultaneously due to phenomena such as overlaying and interlacing.

This enables quantum computers to perform extremely complex calculations at significantly faster speeds than traditional computers. And what benefit will this have in daily life? Its applications range from cryptography and simulation of physical systems to algorithm optimization and machine learning.

Specifically, in the insurance industry, quantum computing may revolutionize important areas. With its ability to process and analyze large volumes of data quickly and accurately, it makes it possible to considerably improve risk assessment and policy customization. In addition, insurance companies can benefit from more precise projections of market behavior and identification of long-term trends. It is also a technology that is very useful in detecting fraud, and in other areas such as roadside assistance and health care.

Quantum computing is defined as the use of qubits and principles of quantum mechanics to perform calculations. Such qubits can represent both 0 and 1 simultaneously, thus allowing multiple calculations to be made at the same time. This feature makes quantum computers potentially much more powerful for certain types of problems than traditional computers, which must process each calculation sequentially, as traditional computing can use multiple processors and cores to parallel execution; this improves speed and efficiency, but each processor continues to operate sequentially within its own task.

The main characteristics of quantum computing are overlaying and interlacing.

Overlaying allows qubits exist in multiple states simultaneously, which exponentially multiplies the processing capacity of a quantum computer compared to a traditional computer. Interlacing is a quantum phenomenon where states of two or more qubits become interdependent. The status of one of the qubits can instantly influence the status of another, regardless of the distance between them. This property allows information to be transmitted at extremely high speeds and can be used to develop highly accurate quantum algorithms.

Quantum computing can transform the insurance industry owing to its ability to process and analyze large amounts of data at an unprecedented speed and scale. This makes it possible to identify patterns and trends with much greater precision, thus significantly improving strategic decision-making.

For example, in risk analysis, a quantum computer can evaluate millions of variables and scenarios in a much shorter time than using traditional methods. This facilitates the identification of risks and the creation of more reliable predictive models, especially with respect to market behavior. Accordingly, insurance companies can respond more swiftly and efficiently to changing economic and consumer conditions.

In risk assessment, quantum computing can revolutionize the way policies are customized: using quantum algorithms, insurers can analyze the details of each client to offer them highly personalized policies that more accurately reflect their individual risk profile.

In specific areas such as roadside assistance, quantum computing can optimize routes and response times, thus improving service efficiency and speed, or help prevent accidents by processing sensor data and simulating driving scenarios. In the financial area, it can optimize investment portfolios and detect fraud more effectively. In health care, it can better manage health insurance and predict the needs of policyholders. And these are just a few examples.

“Insurance companies can leverage the potential of this disruptive technology to create more precise predictive models, offer personalized policies and optimize various operations. Due to the capacity of qubits to handle multiple states simultaneously and the efficiency of quantum algorithms, operational efficiency can also be increased and, with it, client satisfaction, which is always the ultimate purpose when adopting new technologies or other innovations”, said Javier Maraña, head of the Innovation Office at MAPFRE TECH, the MAPFRE corporate technology area.

RELATED ARTICLES: