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Insurtech

Swiss Re: Protection gap biggest challenge for the insurance industry

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At this year’s Insurtech Connect conference, Insider Engage spoke to Pranav Pasricha, Swiss Re's global head property and casualty solutions, Reinsurance, to discuss why the protection gap is the biggest challenge the reinsurance industry faces today and how Swiss Re is using technology to support clients to respond to new and emerging threats.

What are your main goals at Insurtech Connect?

The world knows us as a reinsurer but we want people to see we are also an enabler of technology and product innovation in the industry.

We are not just there to back insurance programmes and provide capacity. We are also there as a partner for both established carriers and emerging insurtechs and vendors. We provide digital platforms, data, and risk models and distribution enablement to our partners.

With all this innovative technology being used in the industry, what appeals to you the most?

The insurance industry could do with a lot more innovation in many different areas. For example, at Swiss Re we are very big on closing the protection gap and sustainability.

We are trying to champion the cause of sustainability in the industry but also helping our insurer partners to develop tools to assess sustainability of their insureds and of their overall portfolios.

We are trying to champion the cause of sustainability in the industry but also helping our insurer partners to develop tools to assess sustainability of their insureds and of their overall portfolios.
Pranav Pasricha, Swiss Re
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Climate change is a big issue so we’re helping people assess and respond to this both from a modelling and technology point of view, but also with capacity as we see an increasing protection gap. Further there is the protection gap due to new and emerging threats such as cyber and we are actively working to build new tools to both help mitigate losses as well as better underwrite cyber insurance.

We also see Embedded as a big trend in the industry, and one that has the potential to help close the protection gap and improve affordability.

In Monte Carlo we addressed the capacity angle and at ITC discussions are more focused on the tech/digital angle related to these trends.

Are you working much with artificial intelligence and machine learning?

Yes that’s become a key part of most modern digital technology platforms. A large part of our solutions are powered by analytic techniques and third party data sources that rely on ML methods underneath.

For example, we just announced a new product, Rapid Damage Assessment, which helps carriers make quick and accurate claim assessments and remediations post catastrophe. That is one example where machine learning is deeply embedded.

Swiss Re is a well-established traditional player but would you agree you are at this conference almost as a tech company?

Yes we are – there are many facets of Swiss Re – capacity provision is a key part of that. However, we also provide technology solutions, digital risk platforms, data services, analytical solutions and risk consulting services.

What is the biggest challenge facing the industry today?

First, the protection gap continues to be the biggest challenge for the industry. It has ramifications on both the capacity side and the technology side. It was already a big issue, but now we see that with rising Nat Cat and other claims costs, affordability is also becoming an issue.

Second we can do a lot more on product innovation. This is a priority for us at Swiss Re as the world has changed so insurance products need to change.

Third, less of a challenge and more of a priority is that we are all very excited about embedded insurance. Embedded insurance can create coverages for the new lifestyle we all live these days and the new risks and circumstances we are exposed to . For instance, with the gig economy it’s hard to get a traditional product that covers all the risk, or is fairly priced, but through embedded now you can cover a whole range of threats to the gig economy.

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