Historically, the insurance industry has talked about a hard and soft market with a multitude of variables determining the state of play. Insurers are au fait with mitigating and planning for large losses because of adverse weather or changes in methods of construction, for example, but the impact of the pandemic has proved to be a game-changer.
We believe we may see a shift in insurance models moving into 2021, as insurers invest in understanding catastrophes and pandemics. Consequently, we may see insurers moving more towards adopting new technology, enhanced technical underwriting models, and scaling down operations.
We see the impact on industries across all arenas; restaurants providing more takeaways and schools and universities offering education and training online as opposed to classrooms. We envisage similar challenges for the broking community in how they conduct their client meetings. The need to invest in digital capabilities will be prevalent even when prospecting new business and even securing existing business. Those brokers who maintain connections with their clients during these difficult times will, no doubt, only strengthen their relationships.
The digital revolution will continue and those brokers who still bury their heads in the sand may be left behind. Whilst those traditional methods of the route to market and managing client relationships will always be required, brokers need to start considering new business models. This should not only be from a cost perspective but also allow flexibility and the potential to new markets via online and cloud-based platforms.
We have already seen a shift into commercial lines and the way we start to look at risks and buying behaviours will result in new operating models, claims-handling processes and technologies. Those brokers and businesses alike that get the balance right between enhancing new technologies and the importance of a human touch will prosper.
If 2020 has taught us anything, it is to expect the unexpected and become masters of reacting and evolving quickly when required to so do. Not only do we have a duty of care in protecting the livelihoods of our customers but also the health and wellbeing of our peers and colleagues, now more so than ever.