Insights into innovation at Swiss Re

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What are the key strategic innovation themes at Swiss Re? Robin Merttens talks to Ruta Mikiskaite, Head of Client Solutions, P&C UKI, about the company's key areas of focus, why it has joined InsTech London, and what sort of companies it is looking to partner with.

Robin: What does your job as Head of Client Solutions for UK & Ireland involve? 

Ruta: I work with colleagues around the globe to see what additional capabilities and innovative approaches we can add to our reinsurance capacity. Swiss Re has always invested in research and development. The Solutions unit takes the best of what already exists, then develops it even further with our client led ‘innovate together’ approach.

With a background in underwriting, where the majority of my time was taken up with analytical work and client engagements, I now focus on conversations with new and existing clients. Discussing what their goals are, what they can bring to the table and how we can help them, in this ever changing re/insurance space. 

Robin: What is your approach to working with partners? 

Ruta: For me, what's important is building true partnerships. At Swiss Re we are building networks on a global level, leveraging existing partnerships with leading tech and data providers and bringing them to the market. Where we see opportunity we are also actively seeking new partnerships to build on the success we had so far with, for instance, companies such as Microsoft and BMW.

Worth noting that we have a different approach from other reinsurers. Sometimes we are a bit more selective. But what matters most is finding a partner that has the same goals as us and then building a relationship based on trust.

For instance, we recently partnered with a company in the US who were launching an innovative motor insurance product, we felt the best support we could give was with our data analytics expertise. We engaged one of our analytics tools that drew on non-insurance data such as traffic congestion, network characteristics, elevation, car sales, weather, specifically rain, and even deer density. This is a great example of how Swiss Re can draw on wider capability to enable further innovation.

Robin: What have been your innovation themes in 2020? 

Ruta: Firstly, transportation. We believe that vehicles will be electric, connected, shared and automated. There is a lot to gain from understanding what technology does to the frequency and severity of accidents, and how this impacts insurance.

We believe there will be a further uptake of telematics and usage-based insurance, stemming out of the current pandemic.

Logistics and understanding supply chains is another theme. Interconnectivity and understanding how risks move from one place to another, how different kinds of risk factors affect certain lines of business and ultimately policyholders or companies, is very important for us.

We are also doing a lot of work in parametric insurance with new data sets and partnering with companies utilising advanced satellite technology as well as transaction and traffic flows to help with rapid loss assessment, and also the design of new insurance products. 

Robin: What was changed by the pandemic? Are you looking at anything new as a result of Covid-19? 

Ruta: Everything has changed, but this change has resulted in an innovation acceleration. Covid-19 is impacting the global economy and insurance will be deeply affected. If you look at the numbers, the world is probably in the grip of the deepest recession since the Great Depression of the 1930s. 

Insurance companies have been caught in a situation where some innovation efforts have had to be paused to allow then to focus on their core business. However, what is clear is that Covid-19 will accelerate a move to data-driven solutions and technological change, something that neatly fits into our innovative DNA and very much benefits our existing and new partners. 

One obvious change has been the 'work from home' culture, which in some businesses has brought on a huge behavioural shift. Not so for Swiss Re, we have been practising the concept for quite some time now.

The change has also brought about new risks. Cyber being a key one, and I'm am personally curious to see whether private line cyber products become a theme going forward. 

Robin: Why has Swiss Re joined the InsTech London community? 

Ruta: InsTech London is one of the biggest and most exciting communities for insurance and tech providers. I have attended a few events and particularly enjoy Matthew and Robin’s conversations with “the movers and shakers of the industry”. It's a great platform for the exchange of ideas. At Swiss Re, we also believe we have a lot of global insights that we think could really benefit the members.

I also have enormous respect for the companies in this space. Both the small, innovative companies, taking their first steps in the industry, along with the more established incumbents, we can all benefit from this ecosystem.

We see InsTech London as one of the key ecosystems for innovation.

Robin: What type of people or companies are you looking to connect with? 

Ruta: I'm looking forward to connecting with people seeking to make a positive difference in the current UK insurance landscape. They might be existing clients, but I also want to seek out and connect with innovative companies that want to be a part of the value chain.

Swiss Re is sometimes perceived as this giant organisation with a lot of risk expertise and knowledge that can be difficult to access. In reality that is not the case, and I am keen to change this perception by bringing insights from our network and sharing our insightful views about markets, risk and what we're seeing in the innovation space. 

I also look forward to helping connect with our community members to exchange views, find partners, collaborate and co-create certain propositions.

Robin: In terms of future developments, what is on the horizon for Swiss Re? 

Ruta: There are five key areas: technological partnerships; quantum cities; climate change and; technological impact on nutrition & health care.

Firstly, technological partnerships. At Swiss Re we focus on the technology and data, irrelevant of the size or of the organisation, for us partnerships and offerings are all about creating sustainable economies and societies.

Secondly, we see a focus on quantum cities and how we can make them more resilient and sustainable. The third one is data analytics services. Specifically, using data to understand the interconnectivity of risks.

What Covid-19 has emphasised is that if societies are faced with big challenges, they need to be better prepared. Climate change is the best example of that as it affects everyone.

Finally, there's also a lot of attention internally on nutrition and the use of wearables in the life and health space. Currently, insurers rely on clinical factors like BMI and blood pressure to evaluate health risk, but other lifestyle factors also influence health and longevity – like how much we sleep, what we eat, how active we are, mental wellbeing, substance use and environment. With the increasing availability of wearable devices and health apps, we now have data sources to reliably track and measure these lifestyle factors.

We see this as an opportunity to move beyond clinical factors and incorporate lifestyle factors to improve how we assess and manage risk.

Robin: Do you think Covid-19 has accelerated the insurance industry's likely adoption of new technology? is that a view that Swiss Re share?

Ruta: Absolutely. It's now impossible for companies not to invest in further technological advancements. We, like everyone else needs to invest in our tech capabilities, but importantly we also need to design data-driven products that help existing and new clients to accelerate their own change.

Robin: Do you see anything disruptive on the immediate horizon? 

Ruta: Definitely and I am particularly interested in two developments. The first would be the greater uptake of usage-based insurance models. In the UK market, I’ve seen an increasing volume of conversations around telematics products and I expect further opportunities and innovative propositions will emerge in the future.

I am also interested to see where telematics will impact the motor sector, but in all honesty it doesn't stop there. There are also benefits for some liability covers.

Another change is whether more companies, especially the newer ones, go all the way and become insurance carriers. That doesn’t happen a lot, but the success of the Lemonade IPO perhaps shows that more players will choose to, not just play in the MGA/Broker space, but go even further and carry the risk.

That's an interesting space for Swiss Re and we have quite a few things to offer to those companies.

Robin: If you had one message to give to InsTech London members, what would it be?

Ruta: Swiss Re has always been part of innovation in insurance and the reinsurance space, but now we are part of the community too.

I am greatly looking forward to getting involved and to seeing what Swiss Re can bring to the community. In addition, I also want to learn from all of the exciting activities that the bright minds of the InsTech London world bring to the sector.

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