All I want for Christmas is…innovation
While not quite topping the Christmas wish list to Father Christmas this year, innovation certainly makes the lists of many executives whether they are frustrated at the pace of change in some corners of the market or they simply have desire to capitalise on potential business opportunities.
Julian Tighe, chief executive of Asta Capital, said he would like to see a number of specific changes at Lloyd’s, which could help reinvigorate the market and ensure that Lloyd’s maintains its competitive edge.
“We would like Father Christmas to bring future-oriented innovation at Lloyd’s, in the form of a new ring-fenced operating environment and establishment model for new, smaller-scale syndicates, and perhaps even for Lloyd’s accredited MGAs,” he said.
He explained that such businesses would be located in the Lloyd’s market itself, with the new operations taking advantage of all the energy and vitality of the underwriting room. “It could spawn a new generation of Lloyd’s underwriting business leaders that currently have few options if they wish to go alone,” he said.
He added that such a model could be a facilitator to the success of independent underwriting in the market, because without the benefit of a corporate cornerstone, capital constraints and the challenges of meeting the legal and regulatory requirements make a smaller launch increasingly difficult.
“We believe that in the absence of continued independent, entrepreneurial underwriting, Lloyd’s risks becoming vanilla, and losing its innovative edge and worldwide lead pedestal,” he said. “The incubator would provide an environment where underwriters could try new products, make mistakes, and learn from them, and from their peers.”
Luzi Hitz, CEO, PERILS AG, also cited innovation as something that should be a priority for the industry.
“I would like to see less talk and more action around the need for market innovation. The re/insurance industry is keen to grow. However, without innovation this will not be an easy task given the centuries old business model which underpins the sector,” Hitz said.
“Everyone recognises this, but to date we have seen more in the way of proclamations on the need for innovation, closing the protection gap, embracing new technologies etc. rather than concrete action to deliver on these. We need to address this imbalance quickly.”
Meanwhile, Peter Allen, partner, Moore Stephens, added that he believes the acceleration of technology in recent years is something that can revolutionise the industry and with this, combined with a surplus of investment capital, offers opportunity to those willing and able to take it.
“The global surplus of investment capital provides unlimited opportunities for the entrepreneurial. Technological innovation has properly arrived in our industry for the first time since the telex. It has never been cheaper or easier to fly somewhere, or hire space when you get there. As a result most senior executives can name any number of potential business opportunities where the constraint is not demand or capital but the immediate presence of a credible leader to make it happen.”
This is just a snapshot of what executives told us in our Christmas questionnaire. For the full comments from all 16 executives that took part in our survey, please click here.
