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After the Shock: Insurance in 2021 and Beyond

Stephen Richardson, Market Consultant at SSP

COVER spoke to Stephen Richardson, Market Consultant at SSP, to unpack the covid 19 pandemic and get his thoughts on the future on the insurance industry moving forward.

COVER: You recently published a whitepaper titled “After the Shock: Insurance in 2021 and Beyond”. It made for very interesting reading. Please tell me a bit about what led to you actually going into all the research for a paper like that?

Stephen: It was a realisation that COVID-19 was going to cause a significant market shock. Whenever there is a major economic or market shock, the successful organisations are those that react to it, and then navigate the changing market in which they find themselves. If you think back, the last major shock we had was in 2008 with the global financial crisis. Insurance reacted by becoming quite insular, focusing on the products and new regulations, reigning in spending. That’s a trend that many analysts think led to the rise of the insurtech; they attempted to fill the customer-centric void that was left by the incumbents. So I was interested to know – after another shock ten or so years on – had the industry learned any lessons from 2008? How were they going to react to this specifically?

COVER: Obviously a lot of work went into compiling this. Please give us some insight into your process?

Stephen: The key to any good report is multiple streams of research and multiple sources from which you derive information. There’s around 50 references in this – including many analyst reports, speaking to executives at insurance companies, and looking at what major industry players and influencers are speaking about on LinkedIn. As I work for a technology company, I also have the advantage of asking my colleagues in the sales and account management teams what are they seeing in terms of customer demand too.

Using all of those inputs – and bearing in mind that all of these sources have their own agendas, I applied critical thinking and my own evaluations to collate my findings. It was definitely not a regurgitation of existing analysis. The aim was to bring something new to the table, as well as sharing others’ insights.

COVER: Personally, I definitely found lots of new insights. What was the most exciting stuff that came out of that for you?

Stephen: The good news is that my findings seem to show that insurance companies have learned from 2008. What we’re seeing right now in response to COVID-19 is greatly accelerated digital transformation. I suspect we’re going to see about five years’ worth of innovation in the next 12- 18 months. In my report, I highlight these innovation trends across three key market segments: personal lines; SME insurance and; the commercial lines space.


These trends are very customer-centric and are largely driven by what-are-called digital ecosystems. Insurers are partnering with a network of complementary products, services, and technologies to deliver improved customer experiences. This might manifest itself in: shorter online journeys; the types of online web journeys; flexible insurance; personalised insurance. Even the most innovative insurers are creating these holistic propositions that extend beyond insurance to include additional services and, sometimes, even moving away from the model of carrying risk to becoming orchestrators of risk- prevention services. There is a real change in the model.


There is a real battle between brokers and direct insurance for distribution. Small business owners basically value two things – advice, and a simple buy-in journey – because they’re time-poor. Direct insurance has the simple buy-in journey done well… but they lack the advice. And so what they’re doing is infusing the advice into the web journey. Where brokers need to adapt is to improve their web journey to make it easier for these time-poor small business owners to purchase insurance.


Insurers here have a very different focus: it’s on improving underwriting profit and profitability by analysing risks at individual and portfolio level, through using internal data insights as well as external data around markets and climates to improve underwriting decision-making and ultimately drive greater profitability. To summarise the three at very high-level and across all of the segments, there are three key technologies that emerge: the use of data; the Internet of Things; and APIs that enable ecosystem integration.

COVER: Did you find that there’s a serious commitment now to try to be part of this evolution?

Stephen: Absolutely. I think there are various things around COVID-19 that have forced insurance companies to innovate. Let’s consider motor insurance. Previously a twelve-month fixed policy was fit for purpose – when twelve months looked the same. Except now, suddenly people are working from home half the time and cars just sit on their driveway – they’re only using it for essential food shopping but are having to pay the same insurance premium that they paid pre-COVID. Back then I was driving all the time – this policy seems unfair to the customer. I think this will act as a real catalyst for insurers to evolve: if you offer a flexible product that can be scaled up or down in terms of the cover, that fully reflects the changing circumstances in people’s lives.

Consumers are more likely to purchase that sort of product because it seems much more customer-centric and far more personalised to them. There’s already multiple examples of that business model in the market. In the SME space, there’s increased risks of cyber-attacks being another catalyst. The commercial lines market is hardening. These aftershocks brought about by COVID-19 are driving real change.

COVER: I suppose people are thinking about risk in a different light – realizing that risk is an important factor to consider in the business. So where to from here, Stephen? What are you doing with the whitepaper and who will benefit from this?

Stephen: We have already distributed this to over 1000 industry professionals that we know and speak with – and by, of course, sharing this through you and the readers of COVER magazine. So this is a direct message to your readers. If you read the whitepaper and find there’s something you’d like to chat through then please get in touch. I’ll be more than happy to jump on a call to give some free consultancy. I wrote this paper ultimately because I’m passionate about insurance companiesthriving – and to do that you must innovate with the right information as your compass.

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