Dubai: Changes in the world economic order combined with protectionism gripping the developed world will lead new growth markets for insurers, Inga Beale, chief executive of Lloyd’s, said on Tuesday.
Speaking at the Dubai World Insurance Congress, Beale said new technologies, such as the use of artificial intelligence, robotics and data analytics will redefine the way insurers have been working for long.
“The innovation gap in the insurance business is widening and the industry is sleep walking into the fast changing market environment. We need to have an open approach to technology changes happening around,” said Beale.
While global market access is very important for the insurance industry, she said the growing voices of protectionism from the developed world will be a big challenge for the industry’s growth.
“The world is changing, and we know the economic power is going to be shifting to countries that we aren’t perhaps that familiar with dealing with. Asia and Latin America together are going to make up about 37 per cent of the property and casualty (P&C) segment of the market. While China volumes are expected to triple, Middle East markets are projected to grow in excess of 14 per cent CAGR in next five years,” she said.
While the decline in oil price and the consequent contraction in economic activities have impacted the underwriting volumes in the GCC region, Beale said robust infrastructure investments across the region has opening up new growth opportunities.
While emerging market growth opportunities can potentially compensate the sluggish growth in the developed markets, she said the industry must speed up technology adoptions.
“Start-ups are just about to bring massive disruption through use of new technologies, artificial intelligence and data analytics. Our business is all about data and if we don’t move ahead of these big changes, we will find it difficult to cope with the fast pace of changes shaping various other segments of financial services and risk management business,” said Beale.
Calling for a customer centric approach to insurance business, she said the industry should figure out ways to reach products and services that are in the best interest of customers.
On top of the challenges related to protectionism, the industry needs to catch up with digital by hiring more millennials and digital natives, the executives agreed. She also lamented the acute shortage of R&D [research and development] spending in the industry.
Welcoming the global insurance industry fraternity to the Dubai World Insurance Congress, Arif Amiri, CEO of DIFC Authority said, with the fast pace of technology adoption, insurance industry, like other financial services sectors have huge growth potential in Middle East and Africa region. “Financial inclusion and development of Sharia compliant insurance offers big growth opportunities in the region,” said Amiri.
