Nick Line, Markel International’s Chief Underwriter, has a vision of the tech-and-data-empowered underwriter.

The global insurance market of the future will harness the best technologies of the present, fuelled by smart use of data, but the magic will continue to happen at the behest of a human insurance professional.

That’s the vision of Nick Line, the Chief Underwriting Officer (CUO) of Markel International, the latest guest to grace the Voice of Insurance podcast, hosted by Mark Geoghegan, and produced in association with AdvantageGo.

Line’s writ runs “the rest of the world” beyond North America, or Markel Group, with the home US market and Bermuda reinsurance market operations being run from the parent.

Line’s book was singled out in last year’s group results for “spectacular” performance, something he is keen to build on, not just relying on “following winds” of high pricing or lulls in catastrophe activity.

The ‘Future CUO’ topic is a rich theme and one that AdvantageGo has featured previously, commissioning “A Day in the Life of a Future CUO – A short film”.

Getting to that future, Line said his underwriters want a “single pane of glass” underwriting workbench approach, rather than multiple systems, building “a slick experience, from beginning to end”.

At CUO level, he said he had more interest in “delegation, empowerment and trust” to the underwriters in his teams than covering his own dashboard with data feeds.

“Where I want to see artificial intelligence (AI) used is to make their lives easier and smoother, to provide a quick service to brokers, write the best risks quickly, and let the underwriter get on with the next thing,” he said.

Line thinks the process of preparing a submission for the underwriter to make a decision is where AI is the “low hanging fruit” making big gains in the short-term.

“Where we’re using a lot of AI now is in our wholesale team, doing a huge amount of work cleansing data to improve pricing. We’re filling in gaps data, such as ship location data,” he said.

Even old pricing models, with data “that died a death” are being “brought back to life using AI”, he noted.

“We built our first pricing tool back in 2004 we’ve rebuilt them all again, new software, new platforms. We’ve built far more detailed reporting for our underwriters, and these are not reports that they then ignore,” Line said.

“We’ve built a culture where underwriters are super interested in their portfolios – the good bits and the bad bits – and we almost make them talk about it every quarter. That will stand us in very good stead, and I think the growth will continue,” he continued.

Quarterly business reviews have resulted in a “culture of performance” different to previous market cycles a decade or longer ago, Line suggested.

Pricing may have peaked in the current re/insurance cycle, flat or falling in some classes, but rates are broadly coming from a high place, and are therefore still adequate, he emphasised.

Setting up in Australia has represented a new presence for Markel International, after a period when no new flags were planted since expansions into Singapore and Spain a decade or more ago.

Line also highlighted the launch of a new division underwriting international casualty represents another major step, underwriting general liability, environmental liability, and life science liability business.

“Without the culture of high performance, people won’t use their pricing tools and look at their data,” Line said.

In discussing long tail risks, including US casualty reinsurance, conversation turned to property catastrophe and climate risk, prompting some interesting remarks about retuning models for the untravelled road ahead.

“It’s not just in property cat; it’s across many areas. We’ve done some simple stuff like looking at cat models with all the buttons turned up to one point five to three degrees of warming to understand what that does to our book,” Line said.

While Markel International leaves calculating climate change’s impact on Atlantic hurricanes to Bermuda-based sibling Nephila Capital, wildfire and convective storm perils are a focus for his global book, shining a light on aggregation, modelling and pricing.

“I’m looking at other impacts that climate change can have on our own portfolio, such as political and social unrest. We know that in a warming climate, there is more social unrest…people are out on the streets…maybe crops fail, price of food goes up, more social unrest, more immigration…and there’s even unrest that’s going to happen due to access to water,” he said.

“Companies that are seen to be polluting and not doing their best in that aspect are potentially more likely to be hacked, for example, by hacktivists, or be subject to protests and efficiency,” he added.

Transformation brings vast opportunity alongside the risks, Line stressed, with demand coming for insurers to play a vital role creating new products, particularly relating to climate risk.

“I’m very excited; there are huge opportunities for us,” Line said, focusing his comments on the renewables and listing wind, solar, hydrogen and battery storage assets. Nuclear is also part of the solution, he noted.

“We’ve expanded our appetite on nuclear business, and you’ve got these small modular reactors (SMRs), which are like ‘flat-pack’ nuclear reactors,” he said.

Nuclear fusion is a technology he is looking at, something that “knocked him sideways” as fusion has been seen as “it’s always thirty years away”, but for which the technology is improving.

“We have a huge part to play in that transition…Let’s help ensure the transition let’s help build the capability,” said Line.

Talk turned to the role of insurance in assisting risk management through services in addition to indemnity. Line noted that this isn’t new – insurers were once, literally, the fire brigade “turning up to put the fire out”.

This turned the conversation to pre-emptive uses for data. “We’d pour all this data into a price and give the price to the customer and not say, ‘if you change your business, you can get a different price’, so the ability to help your customer manage their risk,” he said.

The life cycle of a policy should not start with getting insurance quotes, he suggested, but rather with the need to protect an asset. “Nobody wants a claim, it’s a pain,” he added.