Automated Personalization and Consumer Insurtech in European Law: Prospects and Challenges

The enhanced availability of granular data and the growing sophistication of processing capabilities by insurance companies through big data analytics are said to foster the increasing personalization of insurance products and services for consumers. Many empirical and critical studies, stemming especially from common law jurisdictions, have highlighted how insurance personalization nurtures surveillance capitalism and results in risks to individual customers, as well as to the insurance sector as a whole. The aim of this chapter is to investigate to what extent a similar trend towards automated personalization of prices, continuous (self-)monitoring and real-time adjustment of contractual terms in insurance consumer contracts might be said to be occurring in countries that are currently members of the European Union. To this purpose, the chapter provides a few thoughts as to the actual meaning of the notion of ‘automated personalization’ in insurance, and then delves into the legal factors that, in continental Europe, work as a constraint to paradigmatic shifts in insurance consumers contracts, at least in the short term. The findings will hopefully demonstrate that many of the perils associated, in the English-speaking debate, with automated personalization in consumer insurance contracts are, for the time being, more a myth than a reality in continental Europe. What is real, however, is a different yet equally worrysome trend towards the mass customization of consumer insurance contracts and the robotization of the insurer-customer relationship, especially in the pre-contractual and in the claim handling phases. Mass customization, robotization, and their consequences for consumers, fully deserve the attention of European legal scholarship.