Bermuda set to lead reinsurtech revolution
Bermuda could spark a “reinsurtech” revolution, which combines insurtech with the island's reinsurance expertise, according to panellists at an industry round table of experts hosted by AdvantageGo.
The panel also noted he business environment on the island is also more accommodating to innovation than any other jurisdiction. The discussion highlighted a number of areas, including:
• Whether the Insurtech bubble could be set to burst, with some panel members arguing that this so-called innovation is filled by hype rather than commercial viability;
• Where the next breakthrough will be in data analysis via robotics, artificial intelligence and blockchain;
• Examples of how governments and regulators, such as the Bermuda Monetary Authority are encouraging Insurtech innovation and adoption;
• The biggest winners from the Insurtech revolution could be the brokers if they respond to the digital revolution with inventive solutions, which harnesses their vast levels of data.
AdvantageGo is the commercial insurance and reinsurance software platform from NIIT Technologies. John Racher, vice-president of AdvantageGo, said: “The innovation and insurtech in Bermuda round table panellists discussed that the island will help spearhead insurtech innovation by creating an environment that allows the global reinsurance sector to build and test new products as quickly as technology develops.
“Bermuda has a real advantage. It is not shackled by the complexities of London, and the island should be able to innovate and develop new types of products that relate closely to the technology that is now available.”
In June, the Bermuda Government passed the Insurance Amendment Act 2018 to allow companies to test insurtech solutions before they invest in operational deployment. Panellists at the round table agreed that although many insurtech start-ups are not constrained by insurance and reinsurance regulations, the smart technology firms will ensure they comply with financial regulation.
Mr Racher said: “The opportunity for insurtech and reinsurtech start-ups to use Bermuda as a base for innovation has never been better. Supported by Bermuda's government and regulator, the island can continue to attract technology to the reinsurance industry without compromising any underlying regulatory principles.”
Simon Storey, principal and chief technology officer at Nephila Capital, said: “The market in Bermuda has been excellent at creating innovative structures to transact reinsurance business.
“The reinsurance community has benefited from being able to work very closely together on these structures and transactions. One of our fundamental objectives has always been to reduce the friction that exists throughout this process, this was done with the ultimate goal of creating an effective and efficient marketplace for risk transfer.”
The discussion reflected some of the findings in AdvantageGo's insurtech survey of insurance and reinsurance executives that found upgrading technology is the number one concern for industry leaders. Of those surveyed, 55 per cent of respondents said they were looking at projects involving machine learning, 52 per cent at artificial intelligence and 52 per cent on blockchain.
Other round-jtable attendees included: Michael Doyle, senior vice-president of operations, Ariel Re; Chris Garrod, partner, Conyers; Chris Maiato, principal, Ernst and Young; Lee McArthur, vice-president and co-founder of Five Fathom; Nicole Mitchell, head of IT, Hiscox Re and ILS; John Racher, vice-president, AdvantageGo; and Craig Russell, executive vice-president and head of change, Tokio Millennium Re.
• The AdvantageGo survey can be found at https://www.advantagego.com/news/2018-insurtech-survey/