Gary Richardson is Chief Digital Officer at 6point6. After spending his formative years as a programmer, working for a major insurer in the London Market, he moved into the world of consulting, helping insurers work on digital transformation. Here, he talks to Insider Engage about the role of better data in helping CUOs gain visibility among their peers and take better decisions for their businesses.
Q: How do you see the role of the chief underwriting officer evolving?
Increasingly, the Chief Underwriting Officer’s job is to be the business face of digital transformation, because they're at the sharp end of the customer relationship. They're responsible for new product evolution and understanding customer needs, but they’ve had to wrestle that responsibility from others in the C-suite like the CMO or the CIO – in insurance, it makes sense that the person in charge of underwriting policies should also lead on determining which new markets to enter.
While the consumer has been at the vanguard of digital trends, the line has blurred over the last five years, as organisations have had a new breed of employee come through who are used to transacting on devices in their personal lives. They want the same experience that they get at home, at work.
As a result, a lot of insurers, and underwriters specifically, are struggling to get to grips with the people they’re doing business with, and their tech stack. There isn't a corporate IT standard anymore versus a consumer IT standard. It’s now homogenized, and if you want to attract a younger workforce into the insurance industry, you've got to give them the tools and an experience that attracts the talent that can drive your business forward.
Q: What role do you see data and analytics playing in the evolving CUO role?
The main role of data analytics is to help reduce complexity down to something manageable. There's an increasing pressure on margins, so you've got people trying to do more with less, and as a result where once you might have had a team of underwriters underwriting a portfolio, you might now just have two people, and so now they've got to distil that complexity down to a key set of drivers that tell them how their business is operating, where they should invest more, and where they should divest.
What’s clear today is that operational data can no longer come in dribs and drabs: there has to be a more holistic strategy. That time to insight is even more important because as products are evolving, underwriters don't want to wait three to four weeks before they start getting answers back. The classic pot of underwriting data is becoming hygiene. What CUOs are now looking for is data from alternate sources, both external and internal, to improve their decision making.
Q: Can you give us an example of how data analytics is helping raise the profile of the Chief Underwriting Officer?
The main role of data analytics is to help reduce complexity down to something manageable
It allows CUOs to demonstrate to their C-suite colleagues that they have their finger on the pulse of their business, that they are coming in informed, that they are getting insight readily, and that they're able to make strategic choices in a much shorter timeframe than historically – when it done by underwriting year. CUOs have shifted this pace up now to week on week, understanding how they can switch capacity, especially given the risk universe that we find ourselves in these days, with pandemics and climate change, and investors looking at ESG and wanting more and more information about where they're placing their bets, and what companies they're doing business with, because ultimately it rolls up and impacts their regulatory reporting as well.
How does this translate into real world examples? A lot of insurers today, especially those going direct to consumer, are competing for eyeballs. They’re spending a lot of money on digital advertising platforms, and performance there is not a metric you want to view on a monthly basis, because of the amounts being spent. Realtime, streaming information here can make sure that an insurer isn’t throwing money down the drain.
