Speaking this morning in Monte Carlo at the annual PwC hosted breakfast of the Rendez-Vous event, Thierry Léger, the new CEO of French reinsurer SCOR, explained that the industry faces a problem of insurability that is only becoming more complex.
Léger said that there are numerous areas of challenge and complexity in the world, that affect insurer and reinsurer ability to provide coverage, driving an insurability challenge that the industry must work to address.
“I think we’re in a phase of more challenge, I think we’re really challenged at this point, the hits are coming in from left and right.
“I do believe that in the next 5 to 10 years, we can turn some of it into a opportunity, but where we stand today, with all the disruption going on around us, all that uncertainty and volatility, and the volatility has massively increased,” Léger told the assembled audience at the PwC breakfast briefing event in Monte Carlo this morning.
He went on to say that the industry needs to keep coverage accessible and importantly useful, so excluding every challenge the re/insurance market faces is not seen as the answer.
Léger explained, “Of course we can add exclusions, but ultimately that’s not the solution. I think the solution must be something else, exclusion should be the last resort.
“Sometimes it’s considered transitory, you need exclusions at the beginning until you have established the model, to ensure that insurability is given again.
“But ultimately it cannot be that our industry is adding exclusions and actually having less relevance to the economies of this world, because I really believe that the industry and the development of countries needs strong insurance.
“I think a lot of progress would not be possible, so I urge everyone to step forward and accept the insurability challenge and find solutions.”
He went on to challenge the audience of senior insurance and reinsurance industry executives to address the challenges faced in a volatile world.
“It is up to the insurance industry to actually step forward and accept the challenge of insurability.
“It’s up to us to improve our data, we do need better data in some of these areas to ensure coverage.
“We need rigorous risk management, accumulation control, all the usual. It sounds very technical, but it is very important in our industry.
“In the end, of course very disciplined underwriting as well and without partnerships, it’s not going to work.
“We need partnerships that span across different industries to find a way to handle risk,” Léger stated.
