The optimal insurance company has three "employees": a computer, a dog and an actuary. The computer runs the insurance company, the actuary feeds the dog and the dog bites the actuary if they try to touch the computer. This joke has supposedly been making the rounds among insurtech companies, which are shaking up an industry that has traditionally been slow to adopt new technologies. Granted, you can easily compare quotes online these days. But there are still forms to fill in, policies to print out.

The words "artificial intelligence" might make you think of movies like The Terminator. Machines that learn like humans can be a frightening thought, especially if they look like Arnold Schwarzenegger and roam through Los Angeles wearing dark sunglasses and shooting machine guns. But in real life, artificial intelligence has far more practical applications and is poised to forever transform insurance underwriting. Imagine workers' comp underwriters quickly analyzing thousands of pages of medical bills and health records to predict injury risks. Imagine commercial property underwriters seamlessly incorporating external data from city governments, regulatory agencies and news sources to get a clearer picture of a risk.