What do insurance leaders think about technology?
It’s no surprise that technology is transforming the insurance value chain and enabling carriers to capture new opportunities and make better underwriting decisions. However, what do industry leaders really think about innovative technologies, and how are they incorporating these advancements in their business?
Well, we have some of the answers for you.
Since January 2021, we have published a weekly blog summarising the main points discussed between Mark Geoghegan and industry captains on The Voice of Insurance podcast. These podcasts have provided an invaluable insight into what today’s insurance leaders are focused on, the challenges they face, their thoughts on the state of the market, and their views on technology.
Looking back, we noticed specific recurring topics on innovative technology such as algorithmic underwriting, the impact of ever-growing data sets on the underwriting decision-making process, and what drives underwriting excellence and profitability.
As this year draws to a close, we have picked out some stand-out quotes from interviewees expressing their views on these topics. It was hard to choose which quotes to include as there were so many insightful and thought-provoking views, so you can access all individual podcast blogs via this page if you want to find out more.
“Underwriting is an algorithm,” states John, “When we talk about algorithmic underwriting, what we’re thinking is, how much of that decision tree, how much of that quantification of risk can we do quickly and efficiently in a digitised manner versus that bit that is that as specialty underwriters we need still just take away and think about the nuances on. And the more that we can do in the digitised format, the more efficient we are, and frankly, the more accurate.” – John Fowle, CEO, Chaucer.
“I have been an underwriter for my first 20 years in this industry, and I think I´ll always stay an underwriter. Therefore, I am actually convinced that there will always be the role of an underwriter needed. At the same time, of course, it´s clear that those in insurance and reinsurance – additional data sources, artificial intelligence, algorithms, they will incrementally lead to a certain automation of at least parts of the underwriting process. Generally, I would say we expect a higher degree of such automated, algorithmic underwriting as you call it in primary insurance rather than reinsurance.” – Stefan Golling, Member of the Board of Management of Munich Re.
“I think it really is related to the commoditisation of business, so I think if there is a line of business that is very commoditised, it lends itself well to algorithmic underwriting as long as the wordings are standardised. That´s been an issue for the industry for many years; the wordings are not standardised… so relying on algorithmic underwriting when each wording has a little twist to it that you can´t pick it up in the algorithmic underwriting is very dangerous.” – Jean-Paul Conoscente, CEO, SCOR Global P&C, the Property and Casualty (P&C) Business Unit of SCOR.
“You need human intellect to programme algorithms and the best of both worlds… we are never going to replace our underwriters with an algorithm; we’re very clear with that with all of our underwriters.” – Matthew Wilson, Group CEO, Brit Insurance.
Data & Analytics
“An insurance company needs to be a data company to understand its customers and get the best results.” – William Spiegel, Executive Chairman of Randall & Quilter Investment Holdings Ltd.
“our alpha, if you like, is actually where human intervention is required but at the same time taking benefit of technological advancement and better use of data and data capture.” – Stephen Catlin, Chairman and CEO, Convex.
“First of all, capture the data in a logical way, capture it properly and accurately. I use the principle of do it once and get it right. If your data is good and you can rely on that, then everything flows from that… and then you can use tech to automate all the process, all the returns should be automated, your finance team and reserving team and your underwriters should be spending time actually challenging the data and actually looking at the insights which are coming out from the information as opposed to turning the handle and trying to just do the same old thing again differently.” – Ash Bathia, Chief Executive Officer, Probitas 1492.
“But I think in the bigger ticket, that whole kind of capability of data analytics really hasn´t been applied anywhere near as much as it could be. We´re still rating risks in a way that is really quite basic if we´re being honest with ourselves.” – Richard Watson, the co-founder and CEO of Inigo Insurance.
“We are very much focused on underwriting discipline, underwriting consistency… we try to link it as much as possible to a key focus to client and client needs and being attentive to the expectations and demands of our customers, so that blend of underwriting culture and client focus has been one of the keys to success over the years.” – Jean-Jacques Henchoz, CEO, Hannover Re.
“I think strong underwriting companies will always see the way through good discipline, through proper underwriting procedures and practices.” – Matthew Shaw, Chief Underwriting Officer, Tokio Marine Kiln.
“If you want to make money, you better do it through your underwriting first and foremost. I think that’s a bigger driver of the discipline that you’re seeing in the market than any dearth of capacity.” – Charles Mathias, Group CRO, Fidelis Insurance.