Insurtech Insights New York reporter’s notebook

In the coming weeks, Digital Insurance will have more reports on the Insurtech Insights conference held in New York on June 4-5. These are some brief highlights and impressions from the event.

Climate risk demands community engagement, experts say

In an InsurTech Summit program hosted by McDermott, Will & Emery on June 3, preceding the conference, executives and climate risk advisors from insurers, insurtechs and academia, called for community level engagement for resilience against climate disasters.

A panelist noted that in California, from 2019 to 2022, the claims demands on insurers were stable, keeping them profitable, but they were always “one day away” from catastrophic losses and an industry crisis like the January L.A. fires.

Tariffs make insurers cool to buying US Treasury bonds

In a panel discussion on the impact of tariffs hosted by InsurTech NY on June 3, preceding the conference, Kevin Chen, CIO of Horizon Financial, noted that volatility in U.S. financial markets has created a challenge for insurers managing their bond holdings. Ratings agency downgrades of US Treasurys have cooled foreign insurers’ appetite for these securities, especially European insurers. These insurers had been “major buyers” of these bonds, Chen said.

AI reduced claims processing time, USAA CEO says

AI has reduced the length of time needed to pay claims, said Juan Andrade, who became president and CEO of USAA in April, in a panel discussion on insurers business results from using AI. 

In the January wildfires in California, applying AI technology to drone imagery made it possible to identify claims and pay homeowners before they could even see their property, Andrade added. 

“In catastrophe claims management, it’s really allowed us to reduce the number of days from 14 to seven, where we can pay the claim after a wildfire or a hurricane,” he said. “In areas where access had actually been denied, not only for our claims adjusters, but also for the residents of the neighborhood themselves, we deployed that technology, could look at the before and after, and actually get a check to one of our members before they even knew the state of their home.” 

Chubb executive identifies small business insurance trends

Robert Poliseno, division president of small and lower midmarket at Chubb, presented 10 trends concerning insuring small business:

1. Small business is resilient.
2. Growing revenues in the workplace.
3. AI
4. Application of AI tools in marketing.
5. Concern about climate change.
6. Decline in inflation expectations.
7. Cyber risk.
8. Building trust in digital payments.
9. Workplace discrimination challenges.
10. Access to insurance.

AXA CEO: Using AI to reduce risk is in early stages

Lucy Pilko, CEO of AXA XL, discussed applications of AI for reducing risk, saying the insurance industry is currently at about the same point it was 10 years ago in starting to deal with cyber risks.

Keeping ’90s technology worsens insurers’ talent problem

Garrett Droege, senior vice president and director of innovation and digital risk at IMA Financial, and Josh Hall, head of sales and business development at ManageMy, in a panel on insurance brokerage issues, pointed to a cause for the insurance industry’s difficulties retaining talent. 

When insurers’ interfaces take “20 clicks” to get to writing a policy, because they are using systems built in the 1990s, newer staff find it becomes too difficult to actually write insurance, and many leave the industry within about six months, they observed.

Insurers should promote social good of their product, NAIC official says

North Dakota insurance commissioner Jon Godfread, who is also president of the National Association of Insurance Commissioners (NAIC), on a panel discussion of regulation, called for educating the public more clearly on the financial nature of insurance and its function to protect against risk, as opposed to serving as a savings account or financial investment. 

“We’re seeing a pretty strong narrative against the insurance industry, and a lot of that has to do with misunderstanding of what the products are, and what they do,” he said. “We have to do a better job of telling our story as state regulators, as the insurance industry, all those pieces, what the social good is of the value of insurance into the economy. More understanding of that will hopefully give us a little bit more grace. Our markets are working. It’s just when there’s a catastrophe, it is a catastrophic event.”