Compliance, technology and other insurance topics
Insurance Market Insight
Insurance topics continue to make eye-catching headlines. From compliance and regulation to cutting edge technology, there are multiple articles on what’s new in the insurance market. This month’s highlights include a focus on complaints management, the state of the insurtech movement and some interesting thoughts and actions from Swiss Re and Zurich.
Financial Conduct Authority (FCA) Round Up
GI Complaints: Certain firms are not delivering fair complaints handling outcomes according to a recent supervisory report from the FCA. The main areas identified for improvement are:
- Some firms are in breach of the DISP
- Every aspect of the complaint must be logged and addressed
- Complaint investigation process must be thorough and impartial
- Root cause must be identified and ownership and timings given for relevant actions
- Firms have responsibility to ensure 3rd party partners have robust complaint handling processes
FCA under the spotlight: The FCA must improve performance measuring to prove value for money according to a recent review by the National Audit Office (NAO). Amyas Morse, head of the NAO, said: “Regulators need to do more to show the concrete results they are aiming to achieve for consumers.”
Technologies in focus:
- The state of Insurtech: Interesting research in the article InsurTech: Inside the race to build the next RMS. It appears that the strategies gaining most traction are those that produce enhancements for the existing market. Successful insurtech models are shown to pose little or no threat to incumbents.
- EIOPA analyses licencing approaches to InsurTech: The European Insurance and Occupational Pension Authority recently issued a report “Best Practises on Licencing Requirements, Peer-to-Peer Insurance and the Principle of Proportionality in an InsurTech Context”. According to EIOPA, no new regulation is required at the moment. This telling extract underlines the belief of a need for an ongoing review: “The rise of new technology driven business models (e.g. P2P), the use of new technologies (e.g. artificial intelligence (AI), and Distributed Ledger Technology (DLT)) and the need to rise to the challenge of sound authorisation and on-going supervision of highly digitalised insurers, requires close monitoring of developments.”
Interesting thought leadership piece on Chatbots and the Future of Insurance. The article highlights the value of chatbot technology working alongside more traditional methods of communication. The conclusion from this piece is that humans remain a vital part of customers’ experience.
Cyber & Digital liabilities
The Forum of Insurance Lawyers (FOIL) have created a new Cyber and Digital Liabilities Sector focus team. Kurt Rowe from Weightmans commented in the Modern Insurance Magazine, “…with new technologies come new risks, something that the insurance industry knows a great deal about. However, at FOIL we have found there is a need for improved understanding within the market – across the board from consumers, SMEs to major corporates – about the benefits of cyber insurance and the wide range of risks such insurance can cover.”
Other insurance topics in the spotlight
- Swiss Re: A recent article Technology is Swiss Re’s solution to market challenges gives an account of an interesting interview with Moses Ojeisekhoba, CEO of Reinsurance at Swiss Re. The integration of new technologies are both a critical opportunity for growth and the solution to many of the current challenging market conditions according to the article.
- Zurich: Following the sale of Endsleigh last year, Zurich have temporarily withdrawn from the direct home insurance market. This recent exclusive from Insurance Times quoted a spokesperson from Zurich saying “… following the sale of Endsleigh earlier last year it was clear that we had a platform change requirement so wanted to take the time to fully address this for our direct home proposition”
- Archipeligo Risk Services: Arch Insurance International invests in personal lines MGA Archipelago Archipeligo is a tech-driven MGA with a business model that combines primary data sources and latest technology with a flexible dynamic pricing options and multi-cover policy.
2019 Accenture Global Financial Services Consumer Study provides valuable insight into what customers want. It is the result of a survey of 47,000 banking and insurance customers across 28 markets in Asia-Pacific, Europe, Latin America, Key findings:
- More than 3 in 4 consumers would share their data in return for personalized services
- Consumers value integrated propositions and tailored offerings
- They like seamless integration across channels
- They want to trust the provider