• Matt Carter

Digital distribution in the speciality insurance market



There is digital distribution and then there is digital placing, the latter has had much written about it, especially in London given the effects of Covid through 2020, witnessed by the acceleration of activity on placing platforms within Lloyd’s, demonstrating what used to be done face to face could now pivot and be done digitally, barely missing a beat.


But digital distribution, which we define as pushing product out in the direction of the Insured has been on an accelerated curve for far longer and one that shows no sign of letting up. The need to reshape distribution models; brokers and agents previously being the channel of choice for decades is shifting, and shifting fast for some P&C lines. But how to manage multiple channels and an ever growing rise in customer expectations, whether they are the agent or insured. Recognising this changing landscape means it really does need to now be front of mind for carriers, brokers and MGA’s alike.


It is here therefore that the need to rethink and reposition how products are taken to market becomes the domain of digital distribution. In line with much else in online trading. your customers are no longer likely to seek your product investing the varying degrees of effort required; the expectation is that it finds them and it can be executed online, simply and efficiently.


Whilst not every specialty line of business or product can or should be distributed fully online, the majority have the potential to be enhanced using digital tools, techniques and data, providing a far greater understanding of the real risk exposures. With benefits now understood, the bar is being raised and competition becoming stronger, now is not the time to sit on your hands but to respond and start a journey towards digital distribution mastery.


Future Thinking in 2021

No business line or product should be relying on spreadsheets in 2021 to support any business process, there is a need to reduce old analogue practices and ensure systems become more integrated and connected with your partners to encourage digital interactions.


The old thinking that specialty products were too complicated to digitise has been pretty much expelled. One only has to look at somewhere like the Lloyd’s Lab to see product lines from Cyber, D&O, reinsurance to complex liabilities being transformed digitally with new perspectives and visions of what is possible coming to the fore.


Continuous improvements through the implementation of full cycle feedback loops across the business with operational and organisational restructuring to deliver in operational design, product


Triggers will become vital, creating products that are simpler to navigate and more responsive for customers will become increasingly common, parametric cover and smarter contracts will become the norm.


When engaging with clients we advocate that there is no need to place big bets in transforming your digital distribution strategy. We endorse identifying small micro-innovation changes to start a journey building incrementally to test, learn and deploy.


Finally, the industry needs to find a way to adopt standards for accelerating adoption of increased digital trading, standards will drive both ease of integration and competition which in many other industries has been the kick start for ultimately delivering better customer solutions.

Where to start

What technology, what products, what data makes the difference and of course what is the best route to market, below are 5 things to consider in driving on digital distribution:

  1. Data must be visible across the organisation to ensure that any decisions are made in full knowledge of the facts

  2. Automation should be deployed to remove any repetitive tasks, allowing resources to add value to the business, focus on operational efficiency constantly

  3. Predictive Analytics and AI should be used to inform product or portfolio changes and respond to changing market trends

  4. Engagement, ensure that both systems and staff understand how engaged your customers (agents) are with you, focusing on supporting their activities is as important as supporting your own - the best of anything suffers without ‘buy in’

  5. Customer centricity, anticipate your customer needs and deliver products that respond accordingly

Benefits for the Speciality market

The nature of the speciality market is often the need to identify appropriate risk solutions, this traditionally has been the domain of brokers and wholesalers, but with the ability to go online and where carrier portals have been on the rise, it is now about providing the best solutions with least friction.


Whilst there is less friction required in the operation, there is a need to build a closer mutually aligned relationship between underwriter and broker/distributor. This we refer to as gaining ‘stickiness’, this collaboration and commitment that the carrier is delivering on their promise to provide easy access to the right products in the manner the distributor requires delivers a far better, deeper and engaged relationship.


Where there is a need to provide greater support to customers this collaboration around products that were once negotiated at a distance but now can be transacted in real time is vital to demonstrate that the customer has made the right choice, with their

  • Product

  • Distributor

  • Carrier

  • Premium charged

Route to Success

There are many options to delivering a reimagined distribution strategy how to optimise around channel distribution, digital tools and data led activities.


Our Future Insurance Thinking methodology breaks this down into various aspects to create a journey that is high on action and options and focuses clearly on establishing your destination.


We have built up a good range of experience supporting our clients in their various stages of digital transformation and if having read these thoughts you'd like to learn more, we'd love to help you.


Future Insurance Thinking

This is our methodology to bring together the intersection of technology, people, process and product all wrapped up in the strategic objectives for a business to be clear on their purpose and vision and plot a roadmap to deliver both organisational and operational benefits.


By connecting smart thinking and smart technology, in a way that makes businesses stand out we can help optimise product/service distribution, blending the tech, digital-first approach but ensuring the hugely valuable human touch is not lost.

Matt Carter and Mark Huxley are founders of Cognitive Risk, on a mission to drive on digital adoption and transformation within the Lloyd's, London and Global (Re)Insurance Markets. They want to help organisations re-imagine problems, be creative and uncover smart solutions, by combining their perspectives of INSUR and TECH to define what success looks like for your business and how to get there.

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