Carriers remain behind the curve when it comes to developing products that buyers want, according to Adriano Bastiani, head of casualty facultative at Munich Re.
Speaking on a panel ‘Dealing with the Unknown’ earlier today (12 June), hosted by Russell Group in London, Bastiani said the industry is “lagging behind” the changes taking place at corporate firms.
“We’re always playing catch-up,” he said.
“Risk managers say insurers aren’t providing the right product, insurers are telling buyers that they aren’t willing to pay enough for these products,” he added.
Bastiani said that for the industry to find a way out of this chicken-or-the-egg situation it had to be more proactive in its conversations with corporate clients to better understand their evolving business model and how risks were evolving.
“We need to shape the product around our clients’ needs, but together,” he added.
David Broughton, head of insurable risk at British energy giant Centrica echoed Bastiani and called for (re)insurers to work more closely with buyers to develop better suited products.
He said that all too often insurance is approached by corporates reactively and in a piecemeal approach – often taken out in the wake of an event.
“As businesses, are we spending our money in the right way?” Broughton questioned.
He stressed that as a risk manager at a corporate, when purchasing insurance, he looks for value, not price.
“We want to make sure the insurers we work with are there when we need them,” Broughton said.
Broughton said insurance buyers are often leaned upon by procurement teams to obtain a lower price for cover. However, he said that it is imperative that underwriters understand their business and the risks that they are writing.
“I could get a better price, but the most important thing is that the insurers that we work with understand the risk that they are insuring,” Broughton added.
Suki Basi, CEO of Russell Group said as industries become increasingly more interconnected the industry is “crying out” for an improved underwriting approach that meets the evolving needs of buyers.
“That’s what is missing,” he added.