By Matt Kenyon
On one hand, Silvi Wompa Sinclair’s CV is a very typical profile for the group head of portfolio underwriting at Swiss Re Institute. She has led major teams at Hiscox, Willis Towers Watson and If Insurance.
Yet, she is also a one-time co-founder of the AI solutions provider Ch.AI, and has spent time in consultancy work aiming to bridge the divide between the insurance and technology worlds. A strong advocate for insurance transformation, Wompa Sinclair brings a distinctive perspective into the heart of the 157-year-old reinsurance giant Swiss Re.
Wompa Sinclair views the current wave of emerging insurance innovators not simply as disruptors, but as forces for support and enhancement of underwriting in the insurance industry.
This week, we discussed modern approaches to data, cultural shifts in reinsurance and how incumbent reinsurers can forge effective partnerships with fresh players in the space.
Rethink underwriting data from the ground up
Wompa Sinclair points to a comprehensive integration of data as the next frontier for reinsurance underwriting. In an unpredictable climate, every stage of the underwriting process needs to be connected.
“I would prefer to speak about underwriting being supported or enhanced by technology, rather than disrupted.”
Silvi Wompa Sinclair
Better integration of data is not only needed to accommodate expanding databases – if insurers have to spend most of their time cleaning siloed and variously formatted data, then sheer quantity of data is not of much use. Instead, reinsurers should focus on getting the house in order and improving their unified data stores.
Diversity of data is also vital. To produce a truly informed risk decision, reinsurers should consider external data from a variety of sources. Geospatial data can produce granular risk assessments and industry loss trends can contextualise risks against the market.
Underwriters should balance these sources of digital insights with expert opinions. Human decision-making is key for finely balanced decisions that need to draw on anecdotal experience, and a strong data infrastructure can supplement this process.
Reinsurers should embrace data partnerships and underwriters should work closely with technology solutions and fresh sources of data. Access to a broad range of high quality data should not be seen as a threat to the old way of doing things, but as a way of bringing underwriting expertise up to date.
Keep innovators close, but give them space
The coming together of major reinsurers with solutions providers and insurtechs presents a cultural as well as a technological clash.
“Partner with others – not all risk knowledge sits in the heads of underwriters”
Silvi Wompa Sinclair
There have never been so many options for partnerships, and reinsurers can opt for anything from taking the role of clients to solutions providers to outright investment to exclusive access to risk solutions.
This model of semi-detachment benefits both parties – solutions providers can remain nimble and unencumbered by culture clashes, and insurers can integrate solutions into robust existing structures.
Successful partnerships will successfully balance the institutional memory and expertise of an established firm with the entrepreneurial culture of a new entrant. Insurtechs should be allowed a level of semi-autonomy, to promote productive partnerships that preserve the strengths of each partner.
Ditch “if it ain’t broke, don’t fix it”
A culture of comfortable continuity is breaking down even in the most traditional insurers. Wompa Sinclair points to Lloyd’s of London and their break with three centuries of in-person tradition at the start of the pandemic.
“I think it’s fair to say that the pandemic has brought to life in months what would otherwise have taken years or even decades”
Silvi Wompa Sinclair
As with every industry, a fear of the unknown can hold back progress. Wompa Sinclair argues that the additional distance between reinsurers and consumers has so far spared the reinsurance industry the same pressure that B2C insurers have felt to embrace change.
Broad cultural change cannot just be implemented by executives, but must also be backed up by changes in recruitment behaviour. Acquisition of strong data talent from tech backgrounds not only brings new expertise into the industry, but also fresh approaches to age-old problems.
As the reinsurance industry continues to tackle digitally-driven underwriting, teething problems are inevitable. The shift is not only about optimising data use, but also a broader cultural overhaul – reinsurers should think more broadly about how to bring fresh voices into the decision-making process.
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Matt Kenyon is a content producer at Insurtech Insights.
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