The content has been shared, if you want to share this content with other users click here.
Press Release from Swiss Re
Swiss Re sees growing demand for new reinsurance solutions that help clients manage their portfolios and expand into new segments and markets. Technological advancements are ushering a new generation of industry solutions that use technology to better understand, manage, and ultimately reduce risks. Swiss Re is responding to growing client demand by developing new solutions and services across the value chain. A new offering of ready-to-use, scalable solutions allows insurers to offer the products and services end-customers need. Swiss Re expects prices to stabilise due to recent loss events.
Christian Mumenthaler, Swiss Re's Group Chief Executive Officer, says: "Insurers are rethinking their business models to tap into new opportunities and better service the end-consumer. The reinsurance industry can help them with ready-to-use services and solutions that address growth and profitability. At the same time, innovative solutions help the industry make progress towards closing the ever-growing global protection gap. As we have seen again in the aftermath of recent floods in the US following Hurricane Harvey, as well as devastating flooding in Bangladesh, India, and Nepal, the protection gap is very real and needs to be tackled with solutions that make insurance both more widely and more easily available."
Risk-research and technology help to close the protection gap
Each year, losses from large natural catastrophes and extreme weather place a heavy burden on local economies. In 2016 alone, protection gaps attributable to natural catastrophes and weather events amounted to USD 180 billion worldwide, according to estimates by the Swiss Re Institute.
Several issues contribute to this situation in both mature as well as emerging markets, including a lack of awareness or trust, restricted access to appropriate cover, and concerns over affordability of policies.
In-depth risk research paired with new technology can help the industry develop more efficient and impactful solutions to tackle these issues and close global protection gaps, while at the same time open new market opportunities for insurers.
Clients benefit from Swiss Re's differentiation model
The industry is undergoing substantial change, making growth and technological transformation a priority. Swiss Re is harnessing new technologies to support societal and economic progress, while building up capabilities and risk knowledge. Swiss Re's client franchise model, which facilitates detailed understanding of the risk needs of our clients, underpins this development.
Already today, Swiss Re offers a number of technology solutions to its clients, including a machine learning-based pricing platform to accurately price risks and enable automated claims payments. This platform can be leveraged for multiple parametric insurance products, such as those covering earthquakes or delayed airline flights.
Swiss Re also offers tools to clients that help understanding accumulation risk and supports portfolio steering of a client's own insurance liabilities. These tools provide a visualisation of the client's business, in particular of the nature, volume and trends of a client's risk profile. Additionally, these tools enable clients to more easily compare risk profiles across portfolios and markets.
In the Life & Health Reinsurance space, a solution that has already been in action for a number of years is Magnum, Swiss Re's Life & Health automated underwriting tool. In 2016, the tool processed millions of individual life and health applications, helping insurers, and ultimately the end customer, buy insurance in a more straightforward way.
Efficiency in contract processing
Technology also supports improved underwriting and increased efficiency. Swiss Re continues to develop and accelerate its activities in digital innovation. The Blockchain Insurance Industry Initiative, better known as B3i, is an example of such efforts.
B3i is piloting digital back office processing using a Property NatCat XoL contract. If successful, Blockchain would bring efficiency gains in transaction and contracts processing by simplifying steps and eliminating paperwork. The cost savings from the reduced administration would benefit all involved - especially the end-consumer.
At the 2017 Rendez-Vous de Septembre in Monte Carlo, B3i will launch its blockchain reinsurance platform, showing a prototype smart contract management system.
Prices expected to stabilise due to recent loss events
The challenging industry environment, marked by low interest rates and excess capital, continues to put pressure on both primary insurers and reinsurers. Swiss Re intends to maintain its underwriting discipline to preserve long-term sustainability, which will continue to make Swiss Re a reliable partner for its clients.
In Property, Swiss Re expects prices to stabilise due to recent loss events. In Casualty Swiss Re expects pricing corrections to reflect recent loss trends. In Specialty lines, Swiss Re expects price trends to vary, depending on market and class of business.