Reinsurers must adapt or perish: Dowling & Partners
Technology will be a key success factor going forward for reinsurers and those who do not adapt will not survive.
This is the opinion of Vincent Dowling, co-founder and managing partner of Dowling & Partners, speaking at the Marsh & McLennan Young Professionals’ Global Forum 2015 in London.
He expects the industry to undergo significant change, with consolidation among both traditional risk takers and brokers and new players entering the space which will be ripe for disruptive innovation.
“As we look forward we envisage a world where the industry cannot do what it’s doing now, which is to provide a poor product to its customer... when you are taking a dollar and only giving back 60 cents on the commercial side. Something has to change and you folks can make that change. That cannot work long term. We as an industry need to provide a better value to customers,” said Dowling.
He explained that being close to the customer is critical and intermediaries are currently in that position.
Dowling said: “Who is furthest away? It’s the reinsurers. And more money is staying with the intermediaries in the form of increased compensation and out of the hands of the re/insurers.”
“We are a standoff at the OK Corral right now. We have intermediaries who know they can skip around traditional sources and go direct to the capital markets. We have primary insurers and reinsurers that know they can skip the intermediaries to access the capital markets."
