After more than three centuries at the top, the London Market remains the premier hub for insuring complex, speciality risks. It’s known worldwide as the place to go when you need serious coverage.
In the end there is only one test:
Can the London Market work with technology as something that plays an integral role in the success of all market participants? At NTT DATA, we believe this challenge will be the vital factor in whether London maintains its position as the leading global insurance market in the coming years.
From steering cargo ships carrying vital materials through treacherous waters to quantifying the coverable value of David Beckham’s right foot, the market has always managed to find a way to turn perceived problems into strengths. However, today the market faces a challenge that is different from those that it deals with in the frontline of risk. How can it embrace the current wave of change, as solutions based on automation and machine learning are increasingly used to add value and provide customers with a better experience? Only by investing in new, smart solutions can the market hope to prevent the erosion of its expertise, reputation and industry-leading position in the face of newer, more agile competitors. It is clear that leadership initiatives such as the Future at Lloyd’s programme show a willingness to change. Lloyd’s of London recognises that simply maintaining the status quo is not a viable strategy in the face of the emerging challenges to profitability. In fact, that status quo is already beginning to change, and delaying investment in digital solutions is no longer an option.
The legacy challenges facing almost everyone in the market are substantial and there’s no overnight fix that can transform multinational insurance behemoths into agile technology start-ups. In any case, the industry is not looking for a quick fix. Instead, the market must adopt the concept of exploiting technology as a core value. That doesn’t mean making huge investments in cumbersome IT projects that run forever and cause mass disruption. Instead, incremental, iterative changes that bring improvement one step at a time can provide a more sustainable way forward. Lessons can be learned with each step and every iteration should provide measurable benefits to promote continuing support for modernisation at the highest level.