Old, new companies should collaborate on technology for insurance: ExpertsReprints
LAS VEGAS — Existing insurance sector companies and new technology entrants should work collaboratively to modernize the market, a broker and insurer executive said.
Insurance remains a complex market and technological expertise should be paired with insurance expertise to achieve the best results, they said.
“What works well for us is when we work in a complementary way with a partner,” said John Drzik, president, global risk and digital at Marsh LLC in New York.
He was speaking during a session at the InsureTech Connect conference being held this week in Las Vegas.
Marsh, for example, has a distribution network and knowledge about insurance and can work with new technology companies that offer data and advanced analytics to make the process more efficient, he said.
Experts in various fields of insurance need to be involved in assessing potential insurtech partners, said Greg Hendrick, New York-based CEO of Axa XL, a division of Axa SA. For example, marine insurance experts can assess blockchain products, and construction insurance experts can assess wearable technology for use on construction sites.
“When you have a team of colleagues that are very innovative and very hungry to do that, you don’t have to filter; they’ll filter for you,” he said.
But insurtech companies should not expect traditional insurance sector companies to work out how their offerings will improve their processes, Mr. Drzik said.
“If we have to do the hard work to figure out how the technology is going to work, it’s probably not going to get as much attention,” he said.
When insurtech companies do analyze the insurance industry, they often find it’s more complex than they expected, in particular, the state-based regulatory system and widely differing international regulations complicate insurance processes, Mr. Hendrick said.
Legacy systems that are used for complicated commercial insurance transactions will likely continue as they are entrenched in the process, Mr. Drzik said. Insurtech companies can help modernize those systems and connect them to new digital systems as they are introduced, he said.
“There’s a lot of value in legacy,” Mr. Hendrick agreed. For example, Axa XL can issue a policy in more than 200 countries ensuring compliance in each domicile, he said.