Prioritising the customer experience

Commercial Risk Europe talks to Andy Rice, managing director of property, casualty, technical and special risks for Charles Taylor Adjusting, as well as its UK operations, about putting the customer first in a rapidly expanding risk landscape.

In the last decade, cyber risk has featured prominently in any list of the top risks facing organisations. According to Rice it remains at the top of the tree.

While there is greater awareness of the risk, the risk itself is expanding, he says. The attacks and cyber criminals are becoming more sophisticated and the development of new technology brings new vulnerabilities. “Insurers and risk managers must remain vigilant to stay ahead of the curve,” says Rice. “There are many threats, and many more to come.”

The most recent development in cyber risk involves artificial intelligence (AI). The technology has been widely adopted but it is not yet clear what the risk profile is, says Rice. “There is uncertainty about the limits of its use but can you ever halt innovation? Progress never really stops so it is about having the sensitivity to understand the impact of every new technological development.”

Extreme weather

Climate change is the next big risk on the corporate landscape. Due to the increased frequency and severity of extreme weather events, there is no longer the debate around the existence of climate change. “The accepted view is that climate change is here,” says Rice.

“For years it was debated whether climate change was real. With apparently changing weather patterns and the frequency of extreme weather events, there is a concern for the insurance market.”

Despite its moderate climate, the UK has not been immune to the impact of climate change. Flooding, for example, has affected the UK in each of the last two winters and the Meteorological Office has issued warnings over possible flash floods this summer.

“This has resulted in surge events for insurers and more work for claims professionals,” says Rice. It has also become an increasingly important factor for underwriting insurance policies. “Drainage and the lay of the land is an issue for underwriters, even away from traditional higher risk locations” says Rice.

Business interruption

The third-most-important development concerns business interruption (BI). The pandemic really put BI in the spotlight. In general there has been a growing appetite among corporates for BI coverage and, at the same time, a more sophisticated approach from insurers in terms of the coverage they offer. While still providing the traditional BI following fire and perils losses, there are additional products such as political violence, crisis management or consequent upon cyber intrusion. But, says Rice, while the opportunity landscape develops, so will the policy wordings, which can create the potential for ambiguities and reassessment.

“As loss adjusters, we see the impact of the events leading to BI. The skill is not just the ability to calculate the pecuniary value of the loss, but direction and assistance we can offer in helping businesses mitigate and recover,” says Rice.

Customer experience

When it comes to pricing for claims services, the priority is the customer experience, says Rice. “We handle many major loss events. Price, perhaps, should be a secondary factor in our thought process. Value for money while delivering effective and timely solutions is key.”

“Our most important commodity is our people. Of course, we wish to provide competitive pricing but we also must ensure that our people are appropriately rewarded for the skills they bring to the table,” he adds.

Technology can play a role in processing volume losses and can also be utilised to great effect to offer innovative solutions when married with proven human skills. For example, satellites have been used as part of a data-layering process to assess property and BI claims in Ukraine.

“We started with multiple satellite images and were then able to remotely access on-the-ground video footage to build a detailed picture of the loss site,” says Rice.

“We worked with an ordinance expert to identify the weaponry used to destroy parts of the subject location and then simulate the likely impact upon the structure of buildings and how that might impact property and BI exposure. We have been able to replace a painstaking, dangerous and costly process with a slick layering process thanks to the combination of experience and technology,” he adds.