The 2017 GI Glimpse Seminar focused on the actuarial career; latest developments and outlook for the general insurance (GI) industry; as well as updates on the long tail classes. Suba Chelva reports.
On 1 August 2017, the Institute held the third GI Glimpse seminar, after two successful years previously.
The seminar was opened by our very own President, Jenny Lyon to 100 delegates in the Forum of the Institute’s Sydney office, and 20 attending via webinar.
Jenny welcomed Win-Li Toh of Taylor Fry as the facilitator for the seminar. Win-Li did a great job of facilitating the Plenary and Q&A sessions.
Keynote Speaker, Elaine Collins of Zurich Financial Services was introduced next and she spoke on the Actuarial Career. Elaine provided valuable insights into how young actuaries can develop their soft skills to supplement hard skills to become successful actuaries. These insights included working with talented people which will enhance one’s actuarial career, working on a variety of projects and working in other countries (as it provides a different perspective). Elaine also encouraged young actuaries to join the Institute’s working groups and committees. her own experience participating in boardroom discussions, she said, was invaluable to her career as a Non-executive director. Elaine also touched on the importance of balancing work with life and the value of networking and using ones own network.
Plenary 1 - 2017 Industry Insights
After morning tea, Win-Li Toh and Kevin Gomes of Taylor Fry provided the 2017 Industry Insights for the first plenary session. Win-Li presented on three main areas:
1.) The current economic environment for GI
2.) Big Data
3.) Climate Change.
Win-Li discussed that premium rates have been falling in the past year, however, there are some signs of an end to the soft market cycle, in particular for the commercial GI market for motor and property classes. Given that no bumper profits are expected for the GI industry, efficiency will be the key for General Insurers. Win-Li mentioned that Big Data is gaining momentum; the time is right for digital disruption and the main concern for companies is cyber risk.
“There are two types of companies: companies that have been hacked and companies that do not know they have been hacked," she said.
Win-Li also stated that climate change will have a significant impact on the GI industry, if it hasn’t already, and that Australia is one of the developed nations most vulnerable to climate change. Kevin provided a broader overview of the GI Industry, highlighting underemployment as being more of an issue than unemployment. Yields and currency are still low but there are some signs of an uptick, he said. The shift away from El Nino to more neutral conditions will give rise to more favourable catastrophe experiences and higher growth in alternative capital relative to reinsurance capital due to higher yields, he added.
Plenary 2 - the Changing Face of the GI Industry
Jonathan Shen of Suncorp touched on how the Internet of Things (IoT) can impact short tail insurance lines. From having Connected Devices around the household, to helping save lives and lower claims costs (due to earlier identification of breaks or damages), to better interaction with customers (due to predictive services), Jonathan highlighted the benefits of IoTs. However, Jonathan warned that the security of IoTs is vital.
Next, Will Scully-Power of PASCAL51 presented on how general insurers can use machine learning, artificial intelligence and Insuretech to improve their competitive advantage as well as increase their business efficiency. Will also advised young actuaries to continually learn, test their learning and read extensively if they were interested in becoming an ‘Analytics Ninjas’.
Plenary 3 - Long tail insurance
Plenary Three was jam-packed with telling the 'Long Tail Story Short'. Firstly, John Jeaitani of Finity Consulting presented on the CTP scheme in NSW. He highlighted the key issues of the increasing claims costs in this scheme which are driven by a favourable legal environment, increased legal representation of less severe claims, and fraudulent claim activities. John then explained how the CTP scheme is being reformed in NSW to address these issues including reducing access to Common Law benefits and better fraud mitigation.
Next, Susie Amos of Finity Consulting provided updates on the Financial Lines class. She confirmed that the loss ratio for Financial Lines continues to deteriorate with class action claims now being well established in the Australian market, with fierce competition. However, Susie did mention that premium rates are beginning to rise due to reduced capacity to underwrite Financial Lines globally - with this driven by a higher combined ratio for international insurers and the political environment on an international scale.
Finally, Simon Guthrie from the NDIS provided insights into the funding mechanism agreed to by the different states, and the claims management system and controls in place to manage the scheme costs.
The Seminar ended with delegates and presenters networking over lunch and discussing the diverse content of the seminar. I believe everyone who attended definitely caught a glimpse into the GI industry and took away valuable insights!
On behalf of the 2017 Organising Committee, I would like to thank all the presenters for their insightful presentation as well as Jess Telford and Liz Gemmell from the Institute’s Events team for the flawless execution of the seminar. These types of seminars are vital for engaging and developing actuaries of the future! See you all at the next GI Glimpse!
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