Last week, on Wednesday 12th February, leaders from across the Marine Insurance industry gathered at One Moorgate Place for the very first Concirrus Power20 Summit. The Concirrus Power20 is a community of like-minded digital visionaries focused on harnessing new technologies to drive value in the Marine Insurance market. Representatives from across the value chain shared perspectives on direction, integration and the value they expect to see from digital tools moving forward.
“If you come into this (Specialty Insurance) market and treat it like an industry, you’ll fail. Everyone knows everyone, we’ve all won and lost together. Treat this market like a community and you’ll do well.” - Rupert Atkin, prior Chairman of Talbot to Andrew Yeoman, CEO of Concirrus.
Opening: Andrew Yeoman, CEO at Concirrus
Concirrus CEO Andrew Yeoman opened the summit by recognising the commitment of those within the room to digital operating models. With digitisation on the agenda for many years, the Concirrus Power20 community were taking great strides, and already ahead of the curve, in terms of using data to draw actionable insight. With the number one goal of Concirrus being to add-value to customers, Andy encouraged all to discuss the Quest Marine platform and how it can better serve their needs. With the entire value chain represented, there was an unprecedented opportunity to explore cross industry workflows and how they could be improved.
Keynote: Martyn Thornton, Endurance Athlete, Solo Atlantic
The keynote for the day was by endurance athlete Martyn Thornton, who will undertake a solo row across the Atlantic at the age of 62, in a bid to set a new world record. The challenge is part of a race, starting in Dec 2020 from the Canary Islands, and finishing in Antigua. Martyn’s previous challenges include the Pacific Quest trail, a 2,700 mile hike over five months, carrying everything he needed to survive on his back. The trail spans from the Canadian border, through the Californian desert, Sierra Nevada mountain range, forest of Oregon and Washington Wilderness. Martyn’s focus was on mental toughness, discussing the physical exertion and social isolation that comes with such challenges. His motivation stems from ‘Unfulfilled Potential,’ which he discovered after recovering from depression in his youth.
Digital Transformation is all about People: Alem Jasarevic, Chief Operating Officer, Skuld
Alem focused on the digital transformation journey taking place within Skuld around the adoption of machine learning and big data. He spoke about the strengths of underwriting, including social intelligence and interpersonal skills, as being an art. With the rapid adoption of computing and statistical techniques providing benefits across the industry, the original art of underwriting is now meeting science. Such science is helping to solving old problems, providing a better understanding of risk through improved interpretation of data. It’s the combination of both which gives the industry strength moving forwards.
Figure 1. Skuld, Digital transformation is all about people. 12 Feb 2020
Skuld’s focus on digitisation is four-fold:1.Gaining a better understanding of risk
2.Loss prevention consultation
4.The development of new services
Alem enlightened the audience on the club’s method of integration, which was cross-functional and engaged those with specific domain expertise, IT and Data Science understanding, alongside Concirrus as the InsurTech partner. This approach proved to be the best way to tackle both the hard and soft sides of project integration, including identifying challenges and workarounds.
The Broker Proposition of the Future: Marcus Baker, Global Head of Marine and Cargo at Marsh JLT Specialty
With business currently being very relationship driven, the future will be focused on the value derived from data interpretation. Insight will direct conversations to ensure value for both parties, therefore the more data you have, the more value you create.
Brokerage will move from a purely transactional focus to a transactional and risk advisory focus. Consultation will create closer relationships with the Insured and the market, allowing for the holistic interpretation of interests around risk mitigation. Measuring influential factors will expose which assets have a higher propensity for loss than others. Upon understanding these factors, a Broker can state measures being taken by the Client to reduce the influence of such factors when negotiating with an Underwriter. Insureds can also be advised throughout the life of a policy. New sources of risk can be identified and reported digitally in real-time. Real-time insight leads to more precise and dynamic products, catering for specific needs when required. This can be via several measures, including by the mile or for a set period of time. Sanctions and War zones are good use cases. Certain accounts can also be better placed with specific Underwriters, balancing a portfolio or taking advantage of expertise.
People will still underpin the fundamentals of Brokerage. With a new way of working from both the adoption of innovation and automation, the workforce will need to be both intellectually curious and more diverse moving forward. This will return the market to being innovation and specialist led.
“The future is unknowable, but that’s not an excuse for inaction.”
Figure 2. Marsh, The Broker Proposition of the Future. 12 Feb 2020
2020 Reinsurance Focus: Laurence Lee-Tsang-Tan, Head of Actuarial Analytics and Capital Management, Willis Re
With the broad wealth of data available at the ReInsurance level, Lawrence (Larry) focused on the need to turn data into value added insights for clients. Willis Re decided to work with Concirrus based on experience, a collaborative approach to development without a black box mentality, as well as the fact the platform was business line agnostic.
The specific link between loss experience and behavioural activity shows that whilst traditional factors are still valuable, behavioural factors are far more predictive of risk. Such factors are aimed to be applied to new ReInsurance submissions, focusing on metrics that show portfolio improvements over time. Transactions would then be made off the back of such insight.
There will be inertia once introduced, as the market is typically slow to respond to technological change. However, the Decile 10 initiative is accelerating understanding of technological benefits, and once those benefits become more understood, adoption will vastly improve.
Being ahead of the competition offers huge advantages within this space, and Willis Re is working to create a community of likeminded peers to take advantage of becoming an early adopter. A better understanding of the market will offer those who are ahead a chance to select better risk. Working with Insurers who have adopted the same approach will provide better portfolio’s for investment. This improves profitability moving forward as well as adding value to risk advisory services.
Larry also touched on the opportunities within the Cargo market, which is 4x larger than Hull. As expansion into new business lines such as Cargo occurs, the opportunity to transact better deals becomes even more attractive.
After a series of presentations, delegates moved into focused workshops to discuss future challenges and how digital platforms like Quest Marine would be able to provide solutions that were scalable across both individual businesses as well as the market as a whole. Once all points were addressed, the day was concluded with evening drinks.
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