Insurance regulation structure can cause roadblocks for tech changes
Reprints
Regulation can be another challenge to overcome whenever an industry seeks to effect significant change, but making regulators part of the process can help move things forward, industry sources said.
“I think regulators are becoming more and more engaged and supportive and willing to help companies navigate the changes,” said Tony Kuczinski, president and CEO of Munich Reinsurance America Inc. in Princeton, New Jersey. “I think regulation in all industries is always a factor. It’s how you as a company or as an industry bring that regulator along with you.”
There are both progressive and more traditional, conservative regulators, said Christopher G. McDaniel, president of The Institutes RiskBlock Alliance, based in Malvern, Pennsylvania.
“We sought out six progressive regulators — call them forward-thinking states — and they are being very progressive trying to move insurance forward” with technology adoption in those states, Mr. McDaniel said.
Demonstrating the potential upside of change can be a powerful incentive for cooperation.
“We’re trying to build use cases which make their lives as regulators easier. That’s very attractive to them,” Mr. McDaniel said.
Still, the fragmented nature of insurance regulation presents a challenge beyond that for other industries, like banking.
“Banks have just one regulator,” said Andrew Breen, senior vice president of digital for Argo Group International Holdings Ltd. in New York. “Here, just in the U.S., we have 51 regulators. That makes it a really challenging environment.”
Read Next
-
Digital revolution needs digital natives
The human and personnel challenges of the technology revolution sweeping through the insurance industry may be as daunting or more so than the software and hardware, according to industry observers.
