RPA more disruptive in re/insurance than ‘useless’ blockchain
The use of robotic process automation (RPA) has the potential to become a greater disruptor to the industry than blockchain, the application of which in reinsurance will be limited, Artur Niemczewski, CEO of Pro Global, told Baden-Baden Today.
“Blockchain is useless in reinsurance, because it aims to solve two problems—one of which we are completely unable to solve, and the second problem we don’t have,” he said.
The problem he believes the reinsurance industry is unable to solve is the standardisation of a single data entry point, and the massive shift in behaviour it would require to achieve this.
“We have tried to solve the single data entry for the last 50 years, and we’re still nowhere near. It’s not about blockchain, it’s about behaviour.
“If we can’t change behaviour then no technology is going to help us,” Niemczewski said.
He cited multiple initiatives in the past—such as a few examples coming out of the Lloyd’s market—which have been unable to solve the issue of the industry agreeing on a standard for the entry of data.
The second problem blockchain aims to solve—which he believes the industry does not have in the first place—is the problem of trust.
Niemczewski examined parallels between blockchain and the emergence of cryptocurrencies such as bitcoin, which have been widely used to trade securely with anonymous parties.
“Blockchain can be brilliant but you have to understand the application,” he continued. He cited the diamond industry where the use of blockchain is much better suited—especially when parties may not trust each other.
“We don’t have a problem of trust, because the re/insurance industry is business to business; it’s heavily regulated, you have to have your credit rating and you have to be good with your money when it comes to claims payment,” he said.
Niemczewski believes RPA will be a much greater disruptor to the industry, where task-led jobs will be eliminated and will encourage individuals to improve their knowledge for more complex, technical issues in claims.
“The quiet revolution is RPA; everybody is looking at it already,” he said.
These processes can free up a lot of talent to innovate more within the industry, he explained, as well as provide opportunities for better assessment and analysis of risk.
“If you have a greater pool of well quantified data you can make much smarter decisions,” Niemczewski concluded.
Get the latest re/insurance news sent to your inbox every day - Sign up to our free email newsletters
Other stories from the Baden-Baden Day Three newsletter
HIM losses will be capital event for some syndicates but Lloyd’s steady on cat
Scale of Q3 cat losses could be the biggest ever insured cat event
Russia’s national reinsurer makes its mark in year one
Cat losses and the role of local knowledge
Volatility drives demand for quota shares
Global post-loss rate hikes expected
2017 nat cats show value of objective event data
Cat bonds key to closing protection gap
Know your exposures before you talk price
Losses may signal end of soft market
Nat cat losses are an opportunity to prove resilience
Growth of cyber offerings a hot topic
Qatar Re to cash in on US rate recovery
German motor market needs readjusting
Recent cat losses could make ILS collateral more attractive
Soft market still a concern for renewals
Reinsurers must protect their margins
Disposal of legacy business can increase efficiency
Rate hikes unlikely: Caribbean cat facility
P&C execs bullish on pricing following record cat losses
E+S Rück forecasts growth in Germany
London Market launches campaign to tell its story
Cyber risk modelling gets an upgrade
