Insights ahead of the World Economic Forum of Re/Insurance
I sometimes dub them the WEF of re/insurance, because it's essentially an industry "Who's Who", coming together not in the Swiss Alps, but in similarly idyllic settings. These conferences are a place of exchange: networking and comparing notes is a key highlight, meetings are organised for the rest of the year, and research reports are published.
Perhaps one of the most important activities for me in these conferences is to take the pulse of our industry: what are the themes we need to keep an eye on, what are the worries, what are the emerging opportunities or other major developments?
This year's discussions in Monte Carlo will unfold against the looming backdrop of a global economic slowdown and geopolitical turmoil. Many strategic issues in our industry are inevitably affected by these developments, from interest rates and capital supply to pricing and regulatory barriers. But there are two levers that I feel play a key role in helping our industry weather the storm and tap into new growth opportunities in such challenging times.
The first is data and analytics, coupled with new technology. Insurance is all about data. Data that allows us to know who is insured for what. It helps us understand if our business is profitable, if our pricing is risk adequate and it allows us to report coherently back to our management, regulators and shareholders. It also gives us the essential tools to tap into new risk pools. As Swiss Re Institute's sigma publication, "New frontiers for P&C insurers unlocked through advanced analytics" points out: "Competitive advantage will go to those insurers able to use big data and analytics to identify early signals to emerging risks and opportunities, to gain insights into customer behaviour and to make operations more efficient." The way we use data has evolved. What was once a tool helping us record what's been achieved, is now a gateway to understand where it's possible to grow in the future. Swiss Re is helping driving that evolution.
The second topic is about resilience. This involves thinking about how we can make our economies and societies more resistant to shocks by applying our analytics. Essentially, advanced data analytics provides us with the insights we need to proactively address risks and, in so doing, narrow the insurance protection gap. In other words, it's a technique that helps us realise our vision of making the world more resilient. Consequently, it stands to reason that we have a vested interest in both tracking societies' ability to bounce back after setbacks and in measuring the contribution insurance makes to the financial resilience of households and entities that make up societies.
In a special sigma publication "Indexing Resilience," Swiss Re Institute will be unveiling its Macro Resilience Index and its Insurance Resilience Indices, which measure society’s chances of surviving and bouncing back from the kinds of shocks that emanate from the uncertainty of a world in transition. And this is why we consider such indicators to be particularly valuable now, given the current potential threats to macroeconomic stability. So watch this space for further details.
There are a number of other topical matters – and challenges – that will no doubt feature in Monte Carlo, such as the transformative impact of technology for our businesses, changing needs and preferences of customers, the risks associated with climate change, amongst many other things.
With all of this in mind, I plan to go into my meetings at RVS and CIAB offering partnership, and exploring how we can help our clients with solutions that improve their business.
Partnership is at the heart of our business model with a clear end-goal in sight: improving the offering to the end-customer to make the world more resilient.
If you want to come talk to me about industry change, solutions, or just for a catch-up, please feel free to drop me a line in the comments below, or drop by the Swiss Re Pavilion. I look forward to hearing from you!