Here's what insurance industry CEOs from The Hartford, Travelers, Chubb, Allstate, and Markel had to say on insurance tech in recent earnings calls.
Earnings season has kicked in. On on various earnings calls this week, the topic of technology impacting the future of the industry came up multiple times. Notably, leadership at The Hartford, Travelers and Chubb all weighed in on the future of small commercial insurance and their focus on the space.
We compiled the perspectives below.
1. Markel co-CEO Richard Whitt III on the $919M acquisition of State National
“We, like a lot of people, are starting to look at the insurtech space. And State National, I think they are ideally situated to sort of be the go between the insurtech folks and sort of your standard insurance carrier types. It’s a clash of cultures there, I would say.
The insurtech folks are used to things happening lightening fast and with minimal regulatory issues and all that and that’s not insurance. So there almost needs to be a translator between insurtech folks and standard insurance folks. And that is a role that State National plays…And we see them helping us with our insurtech initiatives sort of being that translator between us and those folks.”
2. Travelers CEO Alan Schnitzer: “There is a lot of rhetoric out there”
I think different competitors and others are at different stages of their engagement in the marketplace. We are not standing still…You look at investments like Simply Business that is meant to make sure that as we look around the landscape and see how the world is changing that we are positioning Travelers to continue to be effective and very competitive in that marketplace. And lastly, I would have that small commercial, in fact all of our businesses, have always been competitive and we have got lots of arrows in the quiver that I guess I should say competitive advantages that enable us to compete effectively. So, we feel good about the outlook.
There is a lot of rhetoric out there. How much business is actually being transacted on that basis and how much is aspirational from the perspective whether that you are saying is something that is worth looking into. But I would say that we are as engaged as anybody on – in all those areas and as aspirational as everybody in all those areas…And again, just think about the innovation going on around here are the investments that we are making and we are not flat-footed.
These aren’t things that we are starting with today, these things that we in many, many cases have been thinking about for many years. And again I will just point to the Simply Business transaction. That’s something that we announced a couple of quarters ago, but it’s not something we stumbled on a couple of quarters ago. That was the result of having been thinking about the exact issue you are talking about over a number of years and planning and being thoughtful and strategic about it. So I would say yes, we are where we need to be.
3. Chubb CEO Evan Greenberg: “Change is coming”
“Change is coming. I listen to a lot of loud talk these days…and I do think some of the talk is ahead of the reality at the moment.
But with that said, change is coming. And we are not alone in terms of carriers improving their capabilities, because of what technology brings that will lead that change. It’s around data, it’s around straight through process, it’s around data that improves the customer experience, while at the same time improving your ability to select risk and to do it quickly i.e. in seconds and to be able to then straight through process business.
It’s claims on the other end, almost certain co-boarded claims that can be settled the same way. These capabilities will improve the intermediary ability to sell and service the business at a lower cost, to take that cost out it will speed the process.
But at the same time those same capabilities will be delivered through new clients at the intermediary, where potential customers are buying other services and products and its natural that it at that time they consider insurance, you are licensing your business your small business, you are setting up the accounting and financing of your small business.
It’s a time that you will consider insurance as an example, there will be many like that. You taking out a loan for your business and technology enables those other forms of distribution. The customer will buy it from a desktop, the customer will buy it from a mobile device, they will buy it any time anywhere and they will service it anytime anywhere.
This is not futuristic in the sense of measuring it in years from now. It’s on our door step, this is the next two years or shorter, it will be iterative, it will only get better and better and better. There won’t be one winner, there will be a number of them.”
4. Hartford President Douglas Eliot sees small commercial change happening quicker than a year ago
“There’s been an awful lot of discussion about not only disruption but, clearly, the front-end sales quoting and changes that may occur there. I’d also remind you that in addition to those skills required, there’s still an awful lot behind that is important to the equation, so having world-class service centers, having a terrific claim operation, having dynamic sales professionals, right, having the data and analytics and the science behind the engines. So we’re working on all facets of our Small Commercial operation.
We do see change coming. We see it probably quicker today than we did a year ago. We’re being responsive to that change, and we’re working hard to take advantage of it as it comes.”
5. Allstate President Matt Winter on the digitization of the claims process
We’ve talked about integrated digital enterprise and emerging technologies, one of those areas that we are deploying it initially and in quite some force is the claims area. We believe it’s an area of primed for it because there it is some inefficiency in the way the model operated. In the past, there was a lot of windshield time, there was a lot of dead time, unproductive time as adjusters drove around, driving to cars, driving to body shops for both initial estimates and supplements, and we looked at that and realized that emerging technologies, data and analytics could rectify that and take some of the inefficiency out of the system.
Approximately half right now of all drivable vehicles are currently being inspected through our Quick Photo method of settlement. That has led to the shutdown of many of our driving claim centers and it has also led to reduce need for fuel adjuster adjusters since we took a lot of that inefficiency out of the system. We now have our adjusters looking at enhance photos, digital photos in the computers without having to drive tooling from the sites.