What we learned from Vegas 2022
September brought us the event we were all looking forward to. ITC Vegas 2022. After two years of virtual summits, travel issues, and unease, over 9,000 insurance professionals came together in full force for the flagship event of the year. It didn’t disappoint. Over three days of panels, fireside chats, keynotes, and meetings – both planned or otherwise – those in attendance shared their learnings from the past and expectations for the future. We’ve put together a summary of each of the key points from the conference, so without further ado here, they are. Enjoy!
Embedded Insurance is taking hold
It would be hard to talk about a modern insurance event and not mention embedded insurance. It’s been the talk of the town for some time now. Faster than ever, insurers and insurtechs alike are noticing that there’s huge potential to serve customers and have taken it upon themselves to find fruitful partnerships to enable what is likely to be a watershed moment for the industry. It’s not without reason as well. For what seems like an eternity, the customer experience within the world of insurance has been slated – just look at wefox’s recent publication. Embedded, however, is an opportunity to solve a major issue that has arisen over the last few years.
Over the pandemic, consumers en masse became accustomed to slick, digital experiences – particularly whilst ordering food and clothes. As a result, insurers are no longer judged against other insurers. They’re judged against non-insurers. For example, if a customer can’t access their claim digitally, they are now far more likely to question why their experience can’t match the one they had on Amazon or Deliveroo. Of course, we’re not at that level yet but embedded is a great place to start.
The importance of ESG continues to grow
And that’s true of each initial. Climate change-related catastrophes become more common and more destructive – just look at Hurricane Ian and the fact that the UK tallied record-breaking temperatures over the Summer. Carriers have long been aware of the need to protect high-risk areas rather than just insure them and now the fiscal responsibility is tying into the second initial; the “S” of it all. It doesn’t just make financial sense. It’s the right thing to do.
The insurance industry has the capital, the brains and the capacity to play its part in the fight against climate change and this was more than apparent in Vegas. Parametric offerings for natural disasters are becoming more commonplace. Climate discussions are bearing more fruit. Industry practitioners want to shed light on the topic. On the whole, the industry is ready to be a key player but if companies approach it as a box-ticking exercise, they’re unlikely to meet the regulatory requirements fully.
A new focus on Commercial Lines
The prevailing narrative around disruptive trends in insurance tended to be focused on the B2B customer. “Joe Bloggs” as we might say in the UK. However, in recent times commercial lines have seen a blast of innovation both on the part of new kids on the block such as Ki Insurance, and on the part of legacy carriers.
Understandably, one of the biggest points of discussion has been around cyber. Cyber attacks have become more common – perhaps an unfortunate result of increased digitisation – and the insurance industry has responded in force. While cyber was becoming a big talking point back in 2019, it has now become a top priority for many in the industry and will continue to dominate discussions (and most likely, insurance meet-ups) for a while yet.
The investment landscape has changed dramatically
You only have to look at the numbers to come to that conclusion. After years of seeing new heights of investment and an almost unrelenting willingness to fund the new and exciting insurtechs flooding the industry, the deals have regressed. Insurtech founders will have to be more realistic with their expectations in terms of both funding and valuation and further still, will have to be prepared to wait longer to get the cash injection they need. It’s not all bad news though.
Firstly, investment trends swing in both directions so it’s unlikely that the downward trend will continue too long. Second, we’re still seeing mammoth raises from the likes of wefox and Pie Insurance so there is still a desire to invest. Third, while investors are perhaps being more selective than in the past there is a sense that more attention will be paid to those partnerships. Relationships between investors and founders have always been a crucial foundation on which to scale a business and now, founders at least have one priority they know they need to focus on. How well they work with their investor.
The appetite to innovate remains strong
Throughout the conference, many of us were thinking about the challenges of the current economic landscape and its effect on the industry. However, this hardly tainted the conference. On the contrary, attendees were keen to discover how they could move the needle even further and who could help them do that. It was extraordinary to see so many professionals from an industry often touted as “risk averse” try to find new and innovative solutions to localised and industry-wide challenges.
The fact that this appetite was shown from all sectors of the industry and from all around the world – Arctic and Antarctic notwithstanding – demonstrates that there is still far more to come from the insurance industry.