Learning from digital transformation

In April we hosted the Concirrus Digital Transformation Forum 2021, an evolution of last year’s Concirrus Power20 event. Both united a community of like-minded digital visionaries focused on applying new technologies to drive value in the Marine Insurance market.  

Hosted virtually, this year featured clients including AEGIS, Skuld, and North Group, who discussed how digital tools, like Quest Marine, have transformed operations. Benefits, challenges, and key lessons relating to adoption and new ways of working were shared through individual presentations that led to a group panel. We outline the key topics and statements from the day below, however, you can watch the sessions yourself here.

A new normal 

Long-term performance combined with a catalyst like the pandemic has increased pressure on companies to fast-track digital transformation. This is resulting in more practical decisions and applied learning around the integration of new tools. Recognised by all, digital transformation is having a direct impact on capabilities of Insurers, and the services they provide. 

“The world has changed, and it’s been demonstrated by COVID. I think its opened a lot of people’s eyes on what tech can do for people and for customers” Colin Gillespie, Director, Loss Prevention, North Group 

Jonathan Humm, Class Underwriter for AEGIS emphasised the link between the pandemic and a change in practices: 

“Covid is directly relevant here as it has arguably accelerated digital development within the insurance market by 5 years or more. It has forced the adoption of practices that would have been unthinkable five years ago and I think the word practices here is important.” Jonathan Humm, Class Underwriter – Hull and War, AEGIS 

The benefits from AEGIS’ digital journey were summarised into five key points: 

• Improved decision-making 
• Faster response time  
• More accurate pricing  
• Cheaper distribution  
• Cost-saving for client 

“Whilst we aim to create all of these, they don’t happen automatically, so they need constant revisiting to ensure they’re still in scope, achievable and valid to the organisation. Crucially you need to be able to test them” Jonathan Humm, Class Underwriter – Hull and War, AEGIS 

As technology drives new capabilities, it’s critical to make sure they align with corporate goals. Hard and soft measures align with a goal, which itself stems from the need identified prior to adoption.  

Focus on the need

Every insurer/company has unique expectations and attitudes relating to their digital future. This directly influences whether they adopt third-party digital solutions or not. Colin Gillespie, Director, Loss Prevention, North Group talked at length at the event about the specific business needs North Group had and why they decided to partner with Concirrus.

“We had a very specific goal and business need in reducing the admin workload. Over the years, as data has become more readily available, we were faced with more manual work involving the input of data into spreadsheets. It was becoming hard to manage resources and we needed a solution. Concirrus was the solution. We also wanted an always-on system that anyone could use. After looking at several different products we decided on Concirrus because, for us, a user-friendly platform was the key thing. You’re going to have people who are not experts, they know the business, but not the system. For me, this was the key strength of Quest as you can look at the screen and understand what it’s telling you.” - Colin Gillespie, Director, Loss Prevention, North Group

Find out how you can automate the entry and analysis of digital submissions here. 

Translate the benefits

Skuld believe that big data presents new opportunities for the future of marine insurance and have been using Quest Marine since 2019. Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld highlighted how big data has been used to help members reduce risk.

“Throughout our work with big data and loss prevention, we have been able to develop and see where our solutions can help our members. Whether it's that we’ve discovered that there is a need for training, new procedure, or checklists. The key point is these solutions don’t only fit one member, but several members. In our portfolio, we have members with the same size fleets trading in the same area, with most likely with the same type of cargo and very similar operations. This means the solutions we create can be shared with other members, and they can use that insight to reduce risk.” - Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld

“There have been several times when members have come back to us and have said what we did together has really helped and that they now have a much safer operation, therefore we have mitigated risk. This makes me feel proud and makes me confident that this way of working pays off and gives value. It may be time consuming; it might be a little labour intensive but coming from a ship management background the end goal is always with improvement and safety in mind.” Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld

Consider the long-term

As organisations look to differentiate over time, they may adopt a series of tools and integrate them. For others, differentiation may stem from a complete embedding of a single system that they work in partnership to shape. Considering both immediate and long-term needs will define the journey that’s relevant for you.

“We have different technology meeting different needs, but the intention is to house these in the same place and have a one platform that everyone can access.” - Colin Gillespie, Director, Loss Prevention, North Group

Be decisive

Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld also spoke about the importance of decision making.

“How these solutions are communicated internally is important. If top management believes in the technology, then you are halfway there. It can’t be seen as some small side project that one department is dealing with. At Skuld, we want to be bold and say that we want to be at the forefront of this digital journey within marine insurance and P&I. When that is voiced by the CEO’s and top management it states this as our clear vision. You need to be committed to accelerating this by having enough resources and time put into it for a higher chance of success” Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld

Have a plan to for integration

Adoption isn’t as straight forward as purchasing. Companies need to be willing to back the integration of new software financially, but also accept that deployment takes place over time. There is both training and a learning curve involved as staff adjust to new capabilities.

“We came up with a joint project plan to integrate the system with minimal fuss. We then had a familiarisation plan to get people understanding it. Now people are on their own journey, discovering how to use Quest in their jobs. It’s now spread out through the organisation beyond loss prevention, lots of Underwriters are using it, Actuaries are using it, it has worked. It’s testament to the strength of the system and the user interface.

You need to make sure the provider is a good cultural fit, and then do things in small steps. If you take small steps, you gain acceptance and the culture starts to change, but it takes time.” - Colin Gillespie, Director, Loss Prevention, North Group

It’s not always easy

Data also offers a unique challenge and is key in fully integrating any platform. Internal records may be out of date, missing fields, or simply fragmented via legacy architecture. New systems may need to link with existing systems, or other providers, depending on internal commitments.

“We exist in a marketplace where there are inherent difficulties with dealing with data as we have many separate underwriting systems and platforms with different actuarial analysis behind how we process risk. Delegating is not easy, as a Syndicate what might work onboarding a platform for one Syndicate might not work for another using the same platform. One of the biggest challenges is establishing what we held originally, how we clean it so it is valid and useful and what we intend to hold and analyse in the future. The most important thing for us is to reap our goals and objectives at regular intervals to see how they’ve changed.” Jonathan Humm, Class Underwriter – Hull and War, AEGIS

Digital systems bring about challenges, and people will make mistakes as they adjust. Contingencies need to be made regardless of whether it’s outsourced or developed internally, you’ll grow regardless.

“…we still had the same old-fashioned systems, so new data and old systems. Our digital strategy started seven or so years ago when we decided to develop front-end quote and bind platform capabilities, which we now call Opal. We focused on a product that was homogenous, where we had large volumes of data, and easy to sell widely for a specialty line. To get Opal up and running was no easy task. We made a lot of mistakes. Our Head of Digital recently commented that we’ve made seven years of mistakes but that’s seven years more mistakes than anyone else. The flip side to mistakes is gaining knowledge and learning from them.” Jonathan Humm, Class Underwriter – Hull and War, AEGIS

As you progress, staff will become more experienced, allowing you to become more organised in your approach to digitalisation. Expertise can also be acquired to accelerate the dissemination of knowledge.

“We have now formed a digital division where we seek to onboard new products into the environment that look at ways to interact with our Broker and client communities. Even if Opal can’t be a good fit with certain products, we can adapt some parts of that system to the product being offered.” Jonathan Humm, Class Underwriter – Hull and War, AEGIS

Customer centricity is a combination of digital analysis and human experience

Experience and digital technologies can partner to emphasise a customer centric approach. Skuld’s utilising big-data in this way, tackling complex risk through a combination of retrospective and prospective knowledge.

“Members come to us with a challenge and by looking at the members data and experience combined with the insight we get from Quest Marine and Skuld we are able to come up with solutions. That solution is not something we develop ourselves, it’s a product we develop with a member and that solution closes the gap.” - Geir Jorgensen, Senior VP, Global Head of Loss Prevention, Skuld

Last year at the Concirrus Power20, Alem Jasarevic, COO for Skuld stated “Many will agree with me when I say that marine insurance has always been a people-driven industry, where a broad network of relationships is very important. For me, a holistic approach is about utilising the best of both worlds.”

Digital platforms utilise historic and real-time data at scale to provide in depth insight. This can also lead to predictive analytics, both of which serve the Underwriter/Broker.

The combination of a professional’s ability to judge the market, alongside client needs, and access a wealth of information is what will move the industry forward. Reducing manual administration, as well as barriers to insight, will enable a more focussed approach in both new business analysis and claims handling.

“We are very positive with our experience with Concirrus and the wider digital systems we’ve adopted so far. We’re fundamentally a specialty insurance market and we deal with complicated products, so you need to be seeking improvements, not wiping away 50 years of underwriting judgement, and to that end there is a role for the Underwriter in this. When we talk about hybrid/blended systems with human intuition with interrogated data that is very valid.” Jonathan Humm, Class Underwriter – Hull and War, AEGIS

Considered, these lessons are relevant to all organisations in the market. The adoption of new technologies, and the capabilities born from them are changing the industry at a rapid pace. Whilst there are inherent risks, the competitive advantage and service benefits mean we’ll see innovation as the norm in the shift to advanced ways of working.

For more on the Digital Transformation Forum 2021, Quest Marine, a new take on submissions, or how we’re changing Cargo analytics, get in touch.