Modern Insurance Magazine Issue 60

EDITORIAL BOARD
Mitigating Modern Risk
There are many ways in which insurers can,
and should, be more forward-thinking and
proactive in their approach to mitigating
risk. They can do this by leveraging various
emerging and cutting-edge technologies such
as artificial intelligence (AI), machine learning
(ML) and language analysis to deal with large
amounts of data in real-time.
One such technology is the Internet of Things (IoT), where data from
wearables, smart home appliances and other devices can improve
the accuracy of risk assessments and create a clearer, up-to-date
depiction of the risks faced by the policyholder.
A bespoke and personalised risk management solution may also be
offered, something which extends beyond the traditional insurance
policy. For example, insurers can provide their customers with access
to resources and tools that help them to alleviate risk in their everyday
lives. This has already been utilised by some companies who provide
their policyholders with wellness programmes or home security
systems. However, it does not stop there…
Insurers need to improve their collaboration and share more data,
which will inevitably help to address these new and emerging risks.
Working with the likes of the IFB and similar organisations, regulators
and policymakers will assist in developing a new and more robust
approach to risk management. This will undoubtedly result in
insurance that better reflects the constantly changing nature of risk in
today’s dynamic world.
Furthermore, working closely with academic institutions whilst
participating in ‘think tanks’ and research would also greatly
contribute to identifying new and emerging trends.
The key to being more proactive is in keeping an open mind,
embracing innovation and remaining agile in the face of change.
Insurers who are always on the lookout for new ways and means to
tackle the issue of risk – those who are willing to adopt new business
models and trial the latest technologies available - will be better
equipped to meet the needs of their policyholders and provide better
protection to customers and their own organisation alike.
Lior Koskas,
CEO, Digilog UK Ltd
Business Resilience in the
e2e Network Model
Business resilience is increasingly under the
spotlight in the motor claims supply chain. At
the time of writing, the latest provisional findings
from the CMA regarding Copart’s acquisition
of Hills Salvage have rung alarm bells for many
insurers.
‘There are very few salvage companies with a track record of
servicing large national contracts for insurance companies,’ the CMA
states. ‘This deal could reduce the options for customers, which could
lead to higher prices or lower quality services.’ Only one potential
effective structural remedy has been identified - the full divestiture of
Hills Motors by Copart.
The FCA monitors insurers for operational resilience, including the
effective management of third-party providers. Therefore, supply
chain resilience is a business priority for insurers and forms part of
their business continuity planning.
At e2e, we are alive to the operational resilience challenges facing
insurers. Our network model can deliver service certainty to insurers
from their salvage provider, despite significant M&A activity in
the market as a whole. Large, single entity salvage and recycling
companies are attractive propositions for those on the acquisition
trail, representing an increased risk profile for insurers.
The beauty of our unique, non-profit network model is that
it is greater than the sum of its parts. The network provides a
nationwide service delivered by independent, entrepreneurial
salvage businesses with decades of expertise, who are committed
to collective professional standards and unified network goals. The
model also provides insurers with the additional benefit of deep
regional knowledge, and the intelligence available through combined
data and analytics. Should a member of the e2e salvage and recycling
network be acquired, there is the scale, flexibility and capacity for
alternative members of the network to take over. Service is seamlessly
maintained for insurers with adherence to contractually agreed
service level agreements and the audited network quality standard.
The network approach delivers resilience, insulating the insurer from
dependency on one supplier whilst still benefitting from one audit and
management function.
e2e builds resilience into its operations through robust network
management and good governance. Risk mitigation and business
continuity plans, aligned to evolving market dynamics and needs, are
continually reviewed and adapted as required. Risk management rules
cap maximum exposure to any one network member at any one time.
Business continuity plans exist to cater for the exit of any specific
network member, for whatever reason. The insurer contracts with e2e,
and it is e2e’s responsibility to manage the network and deliver against
the insurer’s needs. In the event of a member leaving the network and
where service provision is reallocated to an alternative member, or
members, ESG goals are also factored into decision making in order
to reduce CO2 emissions related to transportation and ensure optimal
proximity of members’ sites.
Jim Loughran,
CEO, e2e Total Loss Vehicle Management
MODERN INSURANCE | 23