Blueprint 2 failure is ‘non-optional’ – LIIBA chief Chris Croft on London market digital transformation

London International and Insurance Brokers’ Association (LIIBA) chief executive Chris Croft stressed it is ‘non-optional’ when it comes to the prospect of Blueprint 2 failing.

The London market’s digitalisation project has had a number of delays on achieving its milestones.

The project is widely viewed as essential to sustaining the London insurance marketplace as a modern and globally competitive hub of insurance activity.

Voice of Insurance podcast host Mark Geoghegan recalled an interview he had with a senior insurance figure on the importance of Blueprint 2. 

Geoghegan said: “Last summer, I had someone on the programme who’d been in the heart of the technology space for a very long time, and he said, ‘no, I would delay it even further, and I would just make it really clear to everyone, we’ve got to do this, we’ve got to do it right, and it’s not going to be cheap, and we have to go for almost the luxury option here – because there’s absolutely no chance that this is should be allowed to fail’.”

Croft said he would ‘absolutely echo that’ and that failure was ‘non-optional’.

Croft highlighted the seriousness of getting the project right: “Blueprint Two – people have to remember what you’re trying to do. 

“Fundamentally with Blueprint Two, there is a reason why the systems at the core of these processes haven’t been replaced for 45 years. 

“It’s because it’s really expleted, deleted, complicated, and no one’s had the energy to even consider it for a long time. 

“So, it’s not surprising that it’s quite difficult. You’re replacing multilateral net settlement engines, and if multilateral net settlement engines go slightly wrong and start sending the wrong bits of money to the wrong people, it could be quite disastrous.”

A career steeped in technology 

The interview journeyed over Croft’s career. As a boy, Croft said he dreamed of playing for Arsenal but the reality of life soon hit him.

Croft started his career in the Department for Transport privatising trains – ‘much of your last 40 years of misery has been directly my fault’, he quipped. 

He then worked for the Personal Investment Authority. He later used his skills as a consultant, then programme manager. 

Between 2007 and 2015, he headed up the London Market Group work on delivering the London insurance market modernisation programme. He joined LIIBA as chief executive in 2016.

Outlining the trade body’s role, he said brokers must be Lloyd’s members to join LIIBA. 

The trade body is an advocate for members’ interests globally, representing brokers and clients in regulatory discussions and market service, with a particular focus on US-UK relationships.

Innovation report 

LIIBA recently put out a report – ‘The Innovation Report: Why Brokers Matter More Than Ever’.

Geoghegan asked about the report, with Croft explaining the rationale of its creation: regulators look at the insurance distribution chain and erroneously believe brokers are ‘bad value’.

He observed: “So, what we see in the result of that misunderstanding – and thus underestimating the value of the broking role – is poor public policy outcomes, poor supervisory strategies and particularly restrictive licensing requirements around the world.”

This inspired LIIBA to produce the innovation report that ‘would educate those people on what brokers actually do and the wide range of risk management services that they provide to their clients’.

Embracing failure

The conversation then turned to technology.

Having spent a significant part of his career involved deeply in insurance technology, Croft’s views certainly carry weight. 

Croft stressed the importance of ’embracing failure’ when it comes to innovation with technology. 

He referred back to the report, which recommends better data sharing to close the innovation gap.  

He stressed embracing failure as a learning tool that can drive progress.

Culture and inclusion 

Croft noted how the FCA rightly has an interest in firms’ diversity and culture.

Evidence shows ‘that more diverse firms make more money’.

Croft said the Trump administration had an impact on this area. 

“So has the position of the Trump government had an influence on others? 

“Yes, we now call it inclusion and culture rather than diversity and inclusion, because some of our larger members would prefer us not to use the word beginning with ‘D’, but we’re still seeing it as a major part of our work.”

LIIBA worked with a number of social mobility charities.

He said: “So, we sponsor 50 students through university through a charity called upReach. 

“They’re all from very low income backgrounds, very high achievers. And you meet them, they’re astonishing people.”

Future outlook

Looking ahead, Croft delivered an upbeat message for brokers. 

He was confident brokers could navigate the softer market, hopefully backed by a supportive regulator. 

He concluded: “I think it’s quite exciting times for insurance brokers. 

“Obviously, moving into a softer market is always a challenge, but one that they have got used to over the years.

“And hopefully, off the back of the report we’ve published, we can drive the knowledge in those who need it – that actually these people who really are at the core of how economies and nations work and deliver some quite good outcomes for people.”