Managing strategic risk for global companies
In today's complex world, companies face multiple challenges when it comes to insuring global assets. Operating across different jurisdictions, they frequently have to deal with a confusing set of local policies with varying degrees of cover.
International insurance programs offer the opportunity to take a consistent approach to risk management, but there are a number of inefficiencies in the way they operate today.
Traditionally the preserve of major multinational corporates, such programs are now being purchased by mid-sized and even smaller companies as they expand their business, supply chains and financial assets into different countries across the world.
However, these smaller organisations face substantial challenges in implementing international policies. For example, many struggle to prevent local offices buying policies from non-program entities, and there can be higher costs involved in such a set up.
For insurers, the challenge is to quantify risks in parts of the globe where they may have no previous experience. And creating standardised policy wording to cover all jurisdictions is a major technical challenge. Swiss Re Corporate Solutions aims to overcome these challenges and advance Corporate Insurance by developing industry solutions together with partners like Württembergische Versicherung.
Technology to the rescue
Some more established insurance companies rely on legacy systems with processes that have been pieced together over time, as well as conflicting technologies that simply do not talk to one another.
To overcome the inefficacies in these legacy systems, which can cause process frictions including delays in settling claims, we need to leverage today's technological advances such as cloud computing to build open and connected industry platforms with API connections to achieve an end to end integration. Other industries are demonstrating the power of such architectures.
International programs involve sharing a great deal of data, much of it unstructured. By structuring data consistently, all parties have a full picture of the risks they are insuring and the cover they are receiving.
Of course, it's possible to use solutions like artificial intelligence to sort this mass of unstructured data, but the only way to make things simpler and more cost effective is to automate the process from end to end.
Transparency for all parties
Contract certainty is a prerequisite to ensuring coverage is complete across all territories. Put simply, customers need to be able to see what risks are covered and where. Again, technology has a critical role to play by making policies transparent on a single platform.
But addressing customers' pain points is about more than just standardising policies, vitally important though that is. It's also about using data to understand and price risk more accurately, wherever in the world our clients operate.
As insurers we are seeing the same trends – reduced capacity, the need for better underwriting discipline and rising insurance rates. But if we can work together and share technology to innovate and stay one step ahead, there is much cause for optimism.
The fortunes of our industry are closely linked to the health of the global economy and there is evidence from our latest sigma report – World insurance: riding out the 2020 pandemic storm – that we are likely to outperform the recovery when it comes.
As we've seen, time-consuming workarounds can make it cumbersome to administer programs on an international scale and across jurisdictions.
We want to make this process simpler and more agile. And we need to better understand the risks we are insuring. As investment returns diminish globally, improving underwriting profitability across the industry will be ever more important.
Setting new standards
In order to achieve these goals, we designed and built a platform appropriate for today’s world and the future. Using technology in this way, we can help drive the industry forward and begin to set new standards.
PULSE, our international program administration platform, combines technology with deep risk insights in a single platform to address the needs of our customers and eliminate inefficiencies.
In addition to using the platform to support our insurance customers, we are now also offering it to Brokers and other Insurance Companies. In this way, we start to address some of the more structural challenges of communication between market participants.
The latest partner to take advantage of the PULSE platform is Württembergische Versicherung. The German insurer will have access to our network of over 150 local office and network partners as of 1st January 2021. This will help it grow its corporate business book while delivering structured and compliant multinational programs to its customers.
PULSE will also allow Württembergische Versicherung to use our ONE Form standardised property policy framework, which delivers higher policy accuracy, increased contract certainty and faster processing – wherever in the world their customer is operating.
In too many cases, the customer experience of international insurance programs isn't up to scratch. But with the whole industry – carriers, brokers and customers – on board, we can reboot it for today's fast-changing and increasingly uncertain world. Let's act now to improve efficiency and give customers the service they deserve.
Above all, we want to make the world more resilient. By taking a data-driven approach and addressing industry inefficiencies, we believe we can do just that.