Guillaume Bonnissent’s Insurance Technology Diary Episode 18: Maximum exposure

Our industry needs “adaptation to new sources of major loss volatility to ensure resilience and profitability”, according to an excellent report just issued by the Oasis Loss Modelling Framework.

The report, entitled Navigating the? storm: the C-suite guide to? mastering exposure? management, makes excellent reading, with market-leading contributors from organisations including Acrisure , Aon , Apollo , Chubb , Guy Carpenter , Howden Re , Liberty Mutual Reinsurance , and MS Amlin Insurance .

Their concise advice declares that re/insurance company executives “must ensure that catastrophe modelling and exposure? management are integrated within broader business strategies, aligning modelling outputs with risk appetite decision-making, outwards reinsurance purchasing decisions, financial planning and regulatory compliance, and stakeholder communication.”

I couldn’t agree more. An integrated approach based on a data-first strategy is now essential to any sizeable risk-carrying organisation wanting to achieve effective exposure management.

As the authors point out, this includes reporting. Fundamental to effectiveness is the carrier’s ability to ensure that exposure management outputs are available in real time to enhance risk selection and pricing? accuracy, demonstrate to regulators the carrier’s adherence to different levels of standards, as well as reporting to the board and the world about loss-event impacts.

This demands data-first technology. “Data-first” was magnificently described by John Mason , the new CEO of PPL Placing Platform Limited , in a recent Voice of Insurance podcast: it’s like a mixed tape vs a Spotify playlist. We used to take the data to the player. Now the player goes to the data.

Notwithstanding a lot of good thinking about catastrophe modelling, the Oasis report has only this to say about tech: “Invest in technology and automation to enhance data processes [that] allow the EM team to focus on strategic analysis and decision support rather than administrative tasks, [and] leverage [sic] automation to reduce costs and increase efficiency.”

The C-suite leaders for whom this report was written have this to keep in mind. The ideal technology for exposure management will be designed from the outset to knit seamlessly with the other data-first technologies used in support of processes across the organisation, and even outside it.

A data-first exposure management system should go straight to the data to put just the right information into the hands of the people who need it, exactly when they need it, in real time.

Everything else is old tech.