Shaping the Future of Insurance: The Power of Partnerships, Data, and Technology

Sally Haines: Hello and welcome to the Sapiens Insurance 360 podcast. I’m your host, Sally Haines, Regional Marketing Manager at Sapiens, and I’m so pleased that you’re out there listening. This is where we discuss the latest news, trends, and issues from across the insurance solutions and technology spectrum.

For me, one of the most rewarding parts of working in the insurtech industry is seeing how innovation isn’t happening in isolation. It’s not just about the breadth and depth of future-forward technology. It’s also about the partnerships across the industry that bring together expertise to create practical, data-driven solutions that today’s insurers need. And speaking of partnerships, with us today is our special guest Andrew Holdway, Head of Distribution Partnerships for EMEA at Swiss Re Reinsurance Solutions. Swiss Re is one of Sapiens’ many valuable partners, and a variety of Swiss Re’s risk data and risk insights solutions are out of the box and pre-integrated within Sapiens’ workflows, bringing together P&C risk information and market insights covering over 100 million SME and Mid-Market companies globally.

Andrew, welcome to the program!

Andrew Holdway: Happy to be here, Sally! Thanks for having me!

Sally Haines: Great. So let’s get started. First question might be an obvious one, but in a complex insurance market, what role do partnerships play in helping insurers modernize effectively? And on top of that, where have you seen the most impact when combining technology and data in a way that insurers can actually act on?

Andrew Holdway: Well, first of all, I think we should acknowledge that the word modernize will probably mean different things to different people, depending on what parts of the business they are sitting in. And secondly, I would hope that we all think of modernizing as a continuous, ongoing activity, not a one-off static deliverable. I’m sure we’ve all experienced delivering something that was thought to be modern at the start of the project, and fast-forward two to three years [and] it’s already looking outdated. And this really plays into the value of a partnership ecosystem that is a growing recognition that to build ourselves can be costly, timely, and possibly a distraction to other core priority topics. Therefore, we are really seeing clients reach out to that partnership ecosystem to help bring specialized and niche solutions that can fit within and around that core technology that can deliver impact across the value chain. And I’m not just talking about static print solutions or partner propositions that also continuously evolve to meet the increasingly demanding and evolving needs of policyholders, employees, intermediaries, and other stakeholders within the business. That is definitely a shift in how insurers see tech and data partners, lesser vendors, but a true business partner to lean into and support and challenge the insurers modernization journey. And where have I seen the most impact? Well, coming from an insurer in my previous life and now supporting multiple countries globally, clearly, we see tech and data as enablers to making better incremental decisions. And using underwriting and risk assessment as examples, we see huge impacts for an underwriter to consume and use data within existing business workflows that can reduce manual data entry, that can remove efforts from using multiple screens and sources to analyze, and then copy and paste data into code workflows, and move towards increasing straight-through processing, the standard of volume business, and to give the necessary risk insights for more complex business to support the underwriter to do what they do best: underwrite. And the output after is evident that’s risk-taking decisions more efficiently, a more healthy bottom line, happier employees to have the tools at their fingertips within existing workflows and not just providing data but really providing deeper insights.

Sally Haines: Great. Thank you. I think if we’re building on that kind of theme of evolving partnerships, insurers are constantly being pitched platforms, data sources, new technologies. What should they really be looking for in a partner that will help them to stay competitive in the next 5 to 10 years? And how can we make sure that we’re not just adding noise, but delivering clarity and insight for them?

Andrew Holdway: Yeah, good question. I mean, you go to any industry event these days, and it certainly can be overwhelming for insurers who enter a room with hundreds of tech and data providers, many of which with really great solutions. And you’re right to question this, how does an insurer sift through them all to find the right partners for today and also for the future?  With that start any relationship that needs to be a strong baseline, understanding what the needs and goals are, what is important to each other, being very clear and what can be delivered and by when? What is on the future roadmap, but also, crucially, what is out of scope completely? This has to be the basis of building long-term trust. The insurer must be confident that that partner can demonstrate a clear understanding of their business needs, and not sugarcoat any of their capabilities. Insurers should be assessing that partner for what they can deliver today, but also tomorrow. I mentioned earlier that insurers should be looking at their partners not as vendors, but [as] an extension to that core team that can be leaned upon, that can be proactive in bringing innovation, enhancements, new ideas, and also challenges to the insurance roadmap. And I’m not just talking about second data roadmaps, but insurers’ plans to enter new lines of business, new customer segments, and even new markets. For those on the other side of the table, we too want to contribute to that journey, and this can also be helpful for us as we understand the sense of direction that insurers are heading into and what capabilities we need to enhance or build to stay ahead of the curve and constantly provide impactful solutions. We see third-party management becoming a key governance, legal, and operational topic, too, with a preference and having less partners to ignore rather than having to manage many third-party providers. Therefore, insurers should also be asking themselves, what more can I corner do to support my business? Insurers may be surprised when we respond, but we should also be inquisitive to bring solutions proactively. And how do we make sure we’re not just adding noise? Well, really being crystal clear at the outset regarding business objectives and being able to measure success against these goals is critical. Being able to offer, for example, sandbox environments or POCs to test a proposition and gain feedback as to if the solution fits or not, and getting the shop a sense of the ROI. If the solution simply doesn’t fit, then it’s not going to be a long-term partnership anyway. But if a solution fits and it can demonstrate impact, then it could be the start of the long-term value creating partnership.

Sally Haines: Great, thank you. Lots to think about there. And I think if we are looking at it through the lens of underwriting specifically, we talk a lot about better, faster decisions. But what does that actually mean in the context of underwriting or portfolio management? And what does it take to turn raw data into trusted, usable input for decisions that carry real risk?

Andrew Holdway: Yeah, I touched on this slightly before, but ultimately, it means giving the underwriter or portfolio manager the tools with the relevant insights at the right time during a process embedded within existing workflows to make better risk selection decisions more efficiently. We hear many figures about how much time underwriters spend on non-underwriting activity, anywhere between 30 to 50% of the time, and the pain points for underwriters of needing to spend time outside of their core workflows to assess data and later bring the insights back into their core workflows, creating margin for human error and really the simple, monotonous task and time taken to do so. We also have pain points regarding the inconsistencies of what data underwriters use and when they use it, which then makes portfolio steering more tricky, too. Having consistency in terms of data quality, the data input stage, automated and enriching existing workflows, creates the output of better and faster decisions. Now, we have to be tough with pure raw data, as it could be difficult to see the forest for the trees, so to speak, and the same data set could be interpreted differently. Raw data requires deep analysis and a contextualized output depending on the use case. Your raw data on claims versus raw data on wildfire risk exposure. Once the raw data has been contextualized, it can be business ready for decision intelligence or usable info, as you called it. And this could be paired with, for example, underwriting business rules withinan underwriting workflow and trigger a next step or even a decision to accept ordecline the risk. We see challenges across the market with insurers not just having access to data but when they have it, not using it for all its power and insights. Therefore, this is a good question for insurers to ask themselves, do I have the right data contextualized in the right way for the specific use case? And am I leveraging the full insights it is providing?

Sally Haines: Great, thank you. I think we pivot slightly, but something that’s front of mind for a lot of people at the moment, is climate change and natural catastrophe exposures. They’re reshaping how insurers are thinking about risk. How do you see the role of external risk intelligence evolving in that space, and how do you think leading insurers can integrate that kind of insight into their daily decision-making workflows?

Andrew Holdway: Well, globally speaking, it is clear that the evolving frequency and severity of CAT events and those driven by the impacts of climate change are having a huge impact, not just on insurers and reinsurers, but the general population, businesses, and the public sector. As recent examples, we saw the flood event in Valencia last year that resulted in over 200 deaths, over 85,000 car claims, and over 35,000 proxy claims. We have the California wildfire earlier this year, and a devastating earthquake in Myanmar in March. Urbanization, growing populations, and underinvestment in defense systems and infrastructure, for example, also contribute to the vulnerability of communities and the resulting economic and insurer losses. Having better quality and easier accessible risk intelligence can only lead to more confident business decisions, and external risk data can contribute in a number of ways. For example, filling in gaps that the insurer currently does not have, providing more granular insights compared to what the insurer already has or versus what is publicly available, bringing in expert views on specific hazards and perils. For example, bringing in forward looking views, for example, the impacts on climate change, and more frequently, we see insurers using external data to provide a second opinion. On the prevention side, better quality risk intelligence is becoming ever more critical for insurers to be able to mitigate impacts of risk events. Be proactive with policyholders ahead of more predictable events, work with the public sector to build a stronger systemic approach to managing risk, and also allocate appropriate capital to pay future claims and remain within solvency ranges. On the risk selection side, having better quality decision intelligence enables insurers to select the right risks at the right price, on the right terms, but to also have such granular insights to be able to explain to stakeholders why certain decisions are being made. It creates transparency in the industry, which sometimes is lacking. And then on the portfolio management side, having better decision intelligence to steer allocation of capital, retained and reinsured risk levels and structures, scientifically drive go-to-marketstrategies, and have real-time impact analysis, for example, contributes to a healthier management of folios and the ability to be confident in decision making and communicating to stakeholders with conviction. And how will leading insurers integrate to this, this insight? Well, I mentioned a few times now the phrase “decision intelligence.” And this is exactly how leading insurers are integrating data at points of decision within workflows to support better and quicker decision making. We see risk data being consumed in underwriting workflows, portfolio management workflows, dynamic pricing and rating workflows, accumulation management workflows. But also to support enriching SOVs. Risk engineering, claims analysis, too.

Sally Haines: Great. Thank you. We’ve got time for one last question, and I’ve saved quite a big question for the end. But where do you think the biggest opportunities lie for technology and data to come together and really change the game for insurers?

Andrew Holdway: Well, in my view,second data can also be described as tools and insights. Insurers want to be able to use the best tools for user experience and operational efficiencies, and the most trusted insights to make better and faster business decisions. One without the other results in frustration, friction, inconsistencies, and also maintaining the chasm between tech and business teams. The biggest opportunity is clearly when the tools and insights act harmoniously together, with seamless user experience within common workflows across the value chain. But also with this, a continuous and data-driven automated feedback loop so that the tech teams can deliver as the business needs evolve and the business teams have a clearer conviction of their needs to communicate to the tech teams. We have a mutual client had a team sitting between the tech and business teams, and they orchestrated amazingly in marrying business needs and capabilities. And with one of the head of the underwriting business teams describing our combined underwriting solution as a dream come true.

Sally Haines: Right, I think a dream come true is probably a good point to end on. So thank you. I know there’s a lot more that we could talk about when it comes to the combination of partnerships, tech, and data. So I think the easiest solution is probably to have you back again for an encore and see what additional progress we’ve made in the months ahead. We’ll have to work on that. But in the meantime, thank you so much for appearing on today’s program and for sharing your insights.

Andrew Holdway: The pleasure is mine, Sally. Thank you!

Sally Haines: And to our listeners, as always, thank you for spending your time with us today. We love hearing from you. So if you have any comments, please do get in touch. And obviously don’t forget to subscribe and stay tuned to the Sapiens Insurance 360 podcast. We’ve got lots more to come. Bye for now!