As we transition back to offices with hybrid working becoming the new normal, we spoke to our senior leaders to see what lessons they’ve learned from the pandemic and of those, which ones they’ll continue to apply moving forward.
Juliet Redfern
Divisional Managing Director, Equine and Livestock
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
The pandemic has allowed us to move forward into a more realistic and flexible world. There has been an acceptance of the fact that people can be trusted to work effectively remotely as they have proven they can and do. With that said, it’s a shame this shift to more flexible working patterns didn’t happen 10 years ago.
This increased flexibility will give everyone a better quality of life going forward, whilst not impacting how we go about our business from either a service or profit perspective. Life goes on no matter what is thrown at us and so, the pandemic has been a great lesson in that regard.
Aside from Covid-19, what is one of the other biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
Lloyd’s has had an admitted license in the state of Kentucky for decades, and the fact it was non-renewed without any consultation with the market was a major disappointment. However, we are committed to continuing to write US business – now on a surplus lines basis – so we will find a way to make that happen for our longstanding and loyal customer base.
Chris Fenn
Divisional Managing Director, Marine
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
There are so many lessons being learned from the coronavirus pandemic. It’s been another reminder concerning the importance of coverage intent and wording construction for insurers, but on a constructive note, it has demonstrated the resilience and huge relevance of marine trade to the world economy, and the corresponding resilience and relevance of marine insurance.
One of the learnings we are taking forward is the ability to engage and connect with clients via video conferencing. We’ve always travelled regularly and extensively and we are keen to return to this, but we now know that we can add even more value to our broker and client relationships through regular video conferencing.
Aside from Covid-19, what is one of the other biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
We have seen a number of large marine vessel claims. The ‘Golden Ray’, ‘Ever Given’ and more recent ‘X-Press Pearl’ events demonstrate both the scale of marine fortuities that can happen and their aggregation potential across marine classes. Whilst these considerations are nothing new for marine underwriters, these events do reinforce the requirement for underwriters to get the basics right.
Underwriters are in the job of accepting risk, but at the expense of stating the obvious, risk selection, line size deployment, layering and pricing really can make a material difference to underwriting results. We have focussed significantly on enhancing our portfolio management over the past 18 months and we are using our data more than ever to inform strategy and drive underwriting decisions. We want our clients to perform freely whilst we prudently manage their risk together.
Scott Bailey
Divisional Managing Director, Cyber
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
Covid-19 has brought further complexity to cyber insurance as our industry contemplates systemic risk more than ever before. But aside from the Covid-19 ramifications, ransomware is the biggest challenge for cyber insurers right now. A loss trend with ferocious appetite; insurers and lawmakers around the world are attempting to improve resilience, recoveries and the treatment of this loss type.
At Markel International, we are insisting on only covering those risks with adequate risk management in place, or a willingness to improve, and quickly. Regrettably, without a true collaboration between insurers and insureds, we will do little to counter this trend. The good news is that with just a few meaningful risk management measures in place, the risk can be mitigated significantly, yet we still see too many companies that will unfortunately need to experience an incident before they take the messaging seriously. I suspect we may see more cyber insurers finding the need to mandate certain risk management provisions as a pre-requisite to obtaining cyber insurance in the future.
Aside from Covid-19, what is one of the other biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
Expect the unexpected! Systemic risks are growing as the world becomes more integrated and interconnected. We have appreciated that for some time in the cyber area, but the coronavirus pandemic has really reinforced how important it is that our whole industry contemplates the ‘worst case scenario’ and imagines the unimaginable.
Carl Titterton
Divisional Managing Director, Trade Credit, Political Risk & Surety (TCPRS)
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
The ability of the team, our broker partners and clients to adapt and operate successfully under duress has been impressive. The key lessons learned include the benefits of a flexible approach to operations and the positives these bring as to how efficiently we can operate and interact with our partners.
A good example of this would be our broker training programmes, where we have been able to expand these to a much broader audience, using online VC tools than we would otherwise have done through traditional in-person events. Going forward, we will certainly look to blend in these tools with old fashioned face-to-face presentations.
What is one of the biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
The high level uncertainty around the economic impact of the pandemic (globally) and forecasting it has been a significant challenge within our class. To overcome this issue, we decided to take a balanced data-led approach when considering the impacts across our portfolio and the opportunities that this has brought.
David Sawyer
Divisional Managing Director, Professional and Financial Risks
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
I think the biggest lesson is that ‘we are in this together’ and as a team, we support each other and work together for a common cause. The level of communication and banter over the last 16 months within the Professional and Financial Risks (PFR) team has raised my spirits, even in the most difficult times. As a team, we will continue to do the organisation proud.
Apart from Covid-19, what is one of the other biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
Strangely, for an underwriter to say, but the hard market has been the biggest challenge. In our position as a market-leading PFR insurer that has had a consistent message for a number of years, brokers have looked to us to support them as other markets have changed appetite and exited classes.
PFR has been inundated with enquiries, which we have done our best to provide the service brokers have come to expect from us, but it has not been easy and has proven to a herculean effort by the frontline underwriter. This has shown across all our KPIs in 2020 and in 2021 there has been no let up. I would like to say a big ‘thank you’ to the PFR team – let’s make 2021 an even better year.
Rohan Davies
Divisional Managing Director, Energy
What are the biggest lessons you have learned from the coronavirus pandemic and how have you applied them going forward?
The biggest lesson that we already knew was that teamwork in these difficult times was the way to come through everything Covid has thrown at us by continuing to offer and deliver great products and services to our clients. The overwhelming messages from the brokers over the past 18 months is that they wanted rapid, consistent and well informed decision making from the underwriting teams. All our underwriters are fully empowered to make decisions, so our brokers know that the person they are talking to about a risk will ultimately be the person who decides what we do.
Building leadership has also been immeasurably important as we seek to add value to the market place rather than just capacity. We pride ourselves on our ability to offer a best-in-class product on even the highly bespoke and most complex risk in the market. We have grown across the breadth of the portfolio and will seek to build on this success in the future.
Apart from Covid-19, what is one of the other biggest challenges that has impacted your investment class and how have you/do you plan to overcome it?
Other than Covid-19, the most pressing challenge we are navigating our way through is the energy transition. We have expanded our onshore gas and LNG (liquified natural gas) product and included specialist engineering support as gas looks to be the bridging fuel as we grow into a more sustainable energy environment. We have also made major investments in Renewable Energy with a new senior underwriter, Charlie Richardson, who brings a wealth of experience to our London offering. We will be adding more experienced practitioners in the near future, so watch this space.
On our traditional upstream and midstream book, we have not stopped evolving, growing our capacity to USD300m for major offshore installations and continually growing our leadership as we quote competitive products for our clients. The growth in leadership really shows us that we are on-point for what our clients are looking for and are committed to offering them the very best risk transfer products that evolve with them.
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