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VoI Willis Re podcast image Jan 2021

Voice of Insurance podcast with James Vickers, Chair, Willis Re International

 

In this year’s first Voice of Insurance podcast, guest James Vickers, Chair, Willis Re International, speaks to Mark Geoghegan about 1.1. renewals, rate adequacy, the hardening market, and coverage issues surrounding Covid-19.

 

In this jam-packed episode that covers a lot of ground in just 30 minutes, one comment stood out for us when the topic turned to the hardening market and portfolio performance “…but there is this underlying problem that the outlook for investment income is pretty miserable and not likely to improve much and therefore underwriting profitability is the only way forward,” James Vickers, Chair, Willis Re International.

 

As James Vickers comments further, after a number of poor years, reinsurers really need to see a return to some form of sustainable underwriting profitability before the hardening eases off. Taking remedial actions for those underperforming portfolios before it’s too late is necessary if organisations are to survive.

 

Sustained underwriting profitability from a balanced portfolio is non-negotiable as we enter 2021, and prolonged uncertainty persists around the economy. At the time of writing this, England, along with parts of Scotland, have just been plunged into a third lockdown with predictions that it may last in March. With the U.K. Supreme Court yet to release a final ruling on the BI cases brought to court last year, and the long-term impact of Covid-19 still unknown, Insurers and Reinsurers should have an eye on achieving greater balance in their portfolios, secure new business and drive underwriting profitability.  

 

Investments & Profit

 

As James mentions, despite available capital, the outlook for investment “looks miserable,” and driving underwriting profitability is the only way forward. Sharpening underwriting practices and  processes will increasingly rely on having the appropriate tools and insurance software to deal with new data sources, evolving risks, and creating new business, all while working remotely.

 

Underwriters will need to focus on revenue-generating activities and spending more time with clients to drive underwriting profitability. This means that the time has come to automate low-value tasks and manual processes.

 

We highly recommend that you listen to this broad and profound perspective on the industry.

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