“We have disruption all over… (and) the insurance industry deals with it.” That, according to Sean Kevelighan, President and CEO of the Insurance Information Institute (III), who spoke at the recent AAIS Main event in Florida. He notes that the insurance industry is accustomed to dealing with natural and man-made catastrophes, even technology, which a major disruptor right now.
Mr. Kevelighan also says the economy and geopolitics are disruptors as well. Low interest rates, shifts in monetary policy and (de)regulation…all present opportunities for the insurance industry to lead. He notes the great fundamentals of the insurance industry should be talked about more often.
Technology poses a significant threat, particularly in the auto industry with driverless (autonomous) cars. According to Mr. Kevelighan, the auto insurance industry is due for rate increases commensurate with the rising cost of auto repairs, increasing numbers of drivers on the road and distracted driving.
The reduction in “risk pools” also presents a risk to the insurance industry as a result of Big Data. Still, Mr. Kevelighan see opportunities amidst the disruption. Technology and Blockchain can help carriers pay claims faster, underwrite more accurately, and eliminate “pain points” for customers.
Mr. Kevelighan also addresses the talent “concern” in the insurance industry. With many people retiring in coming years, he says there will be a need to replace them with people that have different (technology) skillsets.