Introduction
In today's evolving insurance landscape, businesses face a myriad of challenges that require innovative solutions to stay competitive. From the increasing frequency of natural disasters to the growing expectations of digital-savvy customers, the insurance industry must adapt to the changing tides of risk and customer demands. As technology advances, customer expectations evolve, and global crises emerge, it is crucial for insurance companies to continuously innovate to stay ahead. The interviews in this publication shed light on the critical role of technology, the changing landscape of the insurance industry, the immediate and long-term challenges, and the need to adapt risk assessment and management strategies.
This report provides a comprehensive analysis of the key themes and insights gathered from our interviews with industry professionals and explores the role of spatial intelligence in addressing the challenges identified, shedding light on the innovative solutions that are emerging.
AI Predictive Models: Harnessing the Power of Artificial Intelligence
Artificial Intelligence (AI) has become a game-changer in analysing vast amounts of data and identifying patterns and trends that humans might miss. These models provide insurers with valuable insights for risk assessment, claim prediction, and fraud detection. David Fineberg, Head of Claims UK at Generali, emphasises the significance of leveraging digital platforms to make more informed decisions, streamline operations, and enhance customer experiences. The integration of AI into various aspects of the insurance value chain has the potential to transform the industry and drive greater efficiency and profitability.
We will soon see better structured models in insurance, powered by AI, that are far more competent at predicting environmental, social and governance issues than a human being can ever be.
Syed Hadi
Head of Risk & Compliance, London P&I Club
The number one reason for customer frustration during an insurance claim is a lack of communication on the status of their claim and when they can expect to receive any payout. Automation has the potential to reduce payout times drastically, perhaps even making them instant in the near future!
Victoria Sutton
Head of Claims Operations, Aston Lark
Unlocking Legacy IT: Embracing Technological Advancements in the Insurance Industry
One of the key challenges facing the industry is the need to unlock the potential of legacy IT systems. These outdated systems have long been a barrier to progress, hindering the industry's ability to meet evolving customer expectations and leverage the power of technology. Vanessa Jones, Head of Catastrophe Risk at Dale Underwriting Partners Ltd, highlights the benefits of technology adoption, such as enhanced risk mitigation and a broader understanding of the operating environment. Vanessa urges insurance companies to leverage technology to ease reporting burdens, automate processes, and embrace environmental, social, and governance (ESG) principles for more responsible investments.
In reality, innovation is a more appropriate term when looking at the process of digital transformation and the benefits it can bring to insurance companies.
Michael Gregory
Head of Underwriting Strategy and Delivery, RSA
We also need to address two significant challenges, building the required connectivity in legacy IT systems to surface this information and having highly skilled people who can make accurate, confident decisions at pace.
David Ovenden
Chief Underwriting Officer, AXA
Accelerating Claims with Drones and Satellite Imagery: Transforming Loss Assessment
Traditional methods of assessing damage and processing claims have often been time-consuming and resource-intensive. However, advancements in technology, such as the use of drones and satellite imagery, have revolutionised the claims process. Insurance companies now have the ability to conduct high-level damage assessments within hours, thanks to the swift deployment of drones and access to real-time satellite imagery. This not only expedites the claims settlement process but also provides a greater level of accuracy and efficiency.
With satellite imagery, high-level damage assessments can be performed within a matter of hours.
Tom Upton
Head of Claims Performance - Marine & Energy, Markel
Another exciting innovation is drone technology, which is being used to save time and effort by conducting live site inspections.
Charles Eurell
Claims Director, Hettle Andrews & Associates
Internet of Things (IoT): Revolutionising Risk Assessment and Mitigation
The Internet of Things (IoT) has ushered in a new era of connectivity and data collection. In the insurance industry, IoT devices and sensors have emerged as powerful tools for risk assessment and mitigation. From smart home devices that monitor potential hazards to telematic data gathered from vehicles, insurers now have access to a wealth of real-time information that allows for more accurate pricing and underwriting decisions. The IoT also opens up opportunities for insurers to develop innovative products and services tailored to the evolving needs of customers.
An insurer might gain a more refined understanding of risk through using Internet of Things (IoT) technologies, using a water leak detector in a residential building, or telemetric data from commercial or privately owned vehicles.
David Ovenden
Chief Underwriting Officer, AXA
Data and Data Sharing: Unlocking Insights and Collaboration
Data has always been the lifeblood of the insurance industry. However, the true power of data lies in its ability to be shared and analysed collaboratively. By breaking down silos and fostering data-sharing partnerships, insurers can gain a comprehensive understanding of risks, trends, and market dynamics. David Ovenden, Chief Underwriting Officer at AXA Commercial, suggests investing in climate change research, refining risk understanding through granular data, and adopting location intelligence to mitigate the impact of climate change. Additionally, Tom Upton, Head of Claims Performance - Marine & Energy at Markel International, highlights the significance of data sharing and the utilisation of AI and trend analysis to address emerging risks and develop more robust solutions that benefit both insurers and policyholders.
We are now at a point where it would be beneficial for insurers to share data more freely to achieve better outcomes for everybody.
Tom Upton
Head of Claims Performance - Marine & Energy, Markel
Fundamentally, the future looks less like the past. This creates a challenge for modelling and prediction based on historical data. As a consequence, it’s incredibly important to ensure that your workflows are as efficient as possible, and your data sources are as complete as possible to enable effective decision making. Your data needs to flow cleanly and accurately from its original source to your reporting endpoint so engaging with all the new technology available is critical.
Vanessa Jones
Head of Catastrophe Risk, Dale Underwriting Partners
Diversity in Teams: Driving Innovation and Resilience
By fostering a diverse and inclusive work environment, insurers can bring fresh perspectives and innovative ideas to tackle industry challenges effectively. Diversity not only fosters a more inclusive work environment but also enables companies to better understand and serve the diverse needs of their customers.
Having a diverse and inclusive recruitment policy is incredibly important. When it comes to finding the right people to solve our big problems, employing people from a range of career backgrounds is a great way to avoid uniform thinking and come up with innovative new solutions.
Michael Gregory
Head of Underwriting Strategy and Delivery, RSA
Having a team that blends diverse educational backgrounds and levels of talent results in a broader range of ideas and communication styles that, in turn, drives innovation.
David Fineberg
Head of Claims UK, Generali UK
Net Zero/ESG: Embracing Sustainable Practices
With the growing urgency to address climate change and environmental concerns, insurance companies are increasingly focusing on achieving Net Zero and implementing Environmental, Social, and Governance (ESG) initiatives. By evaluating their portfolios against set criteria and aligning with sustainable practices, insurers can reduce their carbon footprint and support the transition to a greener economy. Syed Hadi, Head of Risk and Compliance at London P&I Club, underlines the importance of adapting risk assessment and management strategies to effectively address the challenges brought about by climate change. Embracing Net Zero and ESG principles not only demonstrates corporate responsibility but also positions insurers as leaders in promoting sustainable practices and mitigating climate-related risks.
A more refined understanding of risk is one that is both more granular and more accessible. It’s having more information and more insight into the exposures that we underwrite.
David Ovenden
Chief Underwriting Officer, AXA
