With Brexit lingering on the horizon, 2019 was a year of contingency. Faced with uncertainty, companies in all sectors were trying to plan for all eventualities. 2020 feels like it will be very different, however.
Regardless of your political view, the general election has established more stability removing many of the unknowns that were hampering long term planning. Companies can now look forward with more clarity; 2020 will be the year of execution, and we’ll see the impact of this for years to come.
Change is afoot
Some uncertainty remains – trade deals haven’t yet been pinned down and climate change is increasing the frequency and severity of natural disasters, instilling greater risk for insurers who will inevitably have to pay out on policies after these unpredictable and devastating events. These factors are uncontrollable, but, now we can hope to see a positive economic impact of a spike in investment and a dip in inflation which will ripple across every market, allowing companies to action the plans they made in 2019.
For example, the Lloyd’s Blueprint sets out its ambitions to become the “most advanced insurance marketplace in the world” and we’ll start to see some serious traction towards this goal. There’s no doubt that the new Lloyd’s will need to trade risk more flexibly than ever, and it needs technology to make it happen.
While the principles of engagement will remain the same, transactions will be transformed by new technology.
Will the claims process, for example, be disrupted by the integration of artificial intelligence (AI)? While AI won’t eliminate face-to-face meetings, it will streamline back-end processes. Support from analytics will de-risk the placement of business within the marketplace. With brokers embracing new technologies to drive their offerings and enable the data-first approach, syndicates will be keen to keep up with the new model to ensure they maximise their efficiencies and ability to work effectively with brokers. As new operating models emerge, we will start to see technology becoming the key foundation for data-centric trading with more and more automation driving the market forward through the challenges ahead.
Similarly, as some insurers have set up their European entities to ensure the continuation of operations post-Brexit, both front and back office operations will need to be under-pinned by great technology in order to ensure effective working across different countries and time zones. Cloud-based technologies will allow brokers to access data from any location, at any time and from any device, in real-time.
Ultimately, we predict the year of 2020 to be the year of action. With less money earmarked for contingency plans and what-if scenarios, brokers have more to invest in digital transformation – something that will be necessary as insurers and brokers seek to find their feet in the post-Brexit environment. With new technology combined with a wealth of talent, 2020 will see the insurance market evolving at pace.