By Lisa Rossi
Insurance companies continue to face a changing world, including a retiring workforce, global upheavals and issues of inflation and interest rates. At the April 20 CEO panel and InsurTech Founder panel at the Global Insurance Symposium, we heard strategies for facing these changes.
Anant Bhalla, chief executive officer and president, American Equity Investment Life Holding Co.
Jeff Dailey, chairman of the board, Farmers Insurance
Kendall Jones, president and chief executive officer, ProAg
Tom Swank, executive chairman of the board and chief executive officer, American Enterprise Group
InsurTech Founder panel
Manish Bhatt, chief executive officer and co-founder, Plum Life
Trevor Gary, co-founder and CEO, Micruity
Bill Suneson, chief executive officer, Bindable
Brent Williams, founder, chief executive officer, and president, Benekiva
Here are takeaways from the two panel discussions.
The most significant issues of change
Panelists said they are grappling with demographic shifts that translate into people retiring, technological shifts that change how people behave and post-COVID behavioral changes that have more people working remotely. “I think technology is playing a big role,” said Jones. “Technology and innovation changes how people behave. What we find important, what we are going to work on, for us, it’s about serving the people and finding the right people to serve them.”
How artificial intelligence can improve experiences and instill confidence in customers
In the commoditized line of insurance, AI is going to “do a better job of being able to understand the riskiness of individuals and being able to price that better, which ultimately … in commoditized insurance, people want lower prices for insurance. It will be a winning strategy.” Dailey said. Swank emphasized the need to be transparent with how companies are using AI, highlighting how it is helping them.
Inflation and interests rates
Dailey said that in his 40 years in the business, he has “never seen changes and lost costs as dramatic as they have been over the last years.” “Labor prices are up, used car prices are up, things like supply chains being disrupted, which means you can’t get parts, which means it takes longer to repair cars, which means we have people in rental cars longer,” he said. Bhalla said one impact is that people are underinsuring their homes, so the cost of replacing homes is greater than what they are insured for.
International events and their impact on the insurance business
Jones said with crop insurance, it’s all about commodity prices. Ukraine is a large exporter, she said, so the Russian invasion of Ukraine added volatility to commodity prices. China is also particularly important to corn and soybean farmers, she said. “If China decides to stop buying, it has a significant impact, and that ripple effect on the economy would be very large. We need China to keep buying our products.” Dailey said the supply chain is critical to fulfilling promises to customers. “We’re so globally interconnected in terms of how we deliver on goods and services that will be a major challenge for property casualty insurers if we lose the chip production in Taiwan or the ability to access that.”
Startups are aware that many people are retiring from the insurance industry. Gary urged those retiring to contribute to startups. “All that knowledge that can take crazy ideas … and turn it into something valuable.” Swank urged employees to evolve, which he said his company supports with development and technical programs to help people “upscale themselves.” “If you want a long career, you have to evolve, because jobs will change over time,” he said.
Advice for budding entrepreneurs
Williams said if you have the research to back up your idea, then have perseverance. Also: “Grandpa always said a smart person always learns from their mistakes, a genius learns from others’ mistakes.” Finally, don’t “go it alone,” said Suneson, who urged people to find a co-founder. “If you have a good idea, share it with people you trust.”
Lisa Rossi is a freelance contributing writer for the Business Record.