Theory at Work: The Future of Insurance is Here
Professor Daniel Schwarcz forges new frontiers with his innovative research into the impact of Artificial Intelligence and the law
Some might call insurance law a snooze of a subject, but it has proved the opposite for Professor Daniel Schwarcz, whose academic research and teaching pursuits affect public policy in significant ways.
“‘Insurance’ is a good way to kill conversation at a cocktail party,” Schwarcz admits. “But for that reason, there is a real discrepancy between its importance in the real world and the attention it receives. What I like about the field is that it allows work in so many different areas such as financial regulation, health law, contracts, artificial intelligence. Insurance is everywhere, and it’s foundational in many of the areas in which law operates.”
Insurance was not on his radar when Schwarcz was growing up in New York. Long before he entered Harvard Law School, the son and grandson of lawyers viewed legal academia as an “enticing, exciting field.” A debater who loved performing before a captive audience, he looked forward to the freedom of teaching and the intellectual stimulation of research. He considered pursuing criminal law, but after graduating and joining the Boston law firm Ropes & Gray, he got his first assignment in insurance law. Schwarcz, an economics major at Amherst, was immediately drawn to the field, which offered opportunities with practical significance while satisfying his appetite for variety.
“My nature is to get interested in different things and flit around,” he says. “There’s an insurance angle to pretty much anything, so I don’t get bored.”
Artificial Intelligence (AI) is just one example. Headlines suggest interest in it has exploded lately, but Schwarcz has been studying AI from an insurance standpoint for years. He often tackles risk and discrimination issues, and AI’s predictions about loss raise complex issues that are at the very least contested and contestable, whether or not the law deals with them, he says. He also has become very interested in how new AI tools such as ChatGPT will impact the practice and teaching of law.
“It’s an evolution,” adds Schwarcz, the Fredrikson & Byron Professor of Law, a frequent source for media commentary. “We’re at the very start of understanding the ways in which AI will affect the practice of law, or any white-collar profession. We’re still trying to understand it.”
The rapidly expanding field of cyberinsurance has also grabbed his focus. He and three other professors recently published results from a wide-ranging study that showed that during data breach investigations, lawyers doing their jobs—protecting client confidentiality, limiting litigation risk—can actually undermine cybersecurity.
“Insurers are unwittingly facilitating this,” Schwarcz says. “They’re paying for the immediate after-effects of the breach but also for the liability incurred, so that means both sides of the ledger are affected. We had to look at the information in ways that would be helpful.”
Co-author Josephine Wolff, associate professor of cybersecurity policy, computer science, and engineering at Tufts University, lauds not only Schwarcz’s insight and boundless energy but also his knack for tackling research that penetrates beyond academic circles. “He is incredibly brilliant as a lawyer, but he also understands how law intersects with other fields,” she says. “It’s inspiring to see how, as a scholar, he is so willing to throw himself into new areas.”
Schwarcz shares this passion with his students. Since joining the Law School in 2007, he has won the Stanley V. Kinyon Teacher of the Year Award three times.
“I love teaching,” he says, noting that it can deliver concrete benefits that affect many lives. “I care that what I do has an impact. For me, it’s not just about process. I like process—sometimes it’s fun—but if it were just about process I’d drive myself a little bit nuts. At the end of the day, I’m not into work unless it might matter.”