Speaking in advance of a trip to attend the World Economic Forum’s Annual Meeting in Davos, Switzerland this week, Inga Beale, the CEO of Lloyd’s of London, stressed the important role insurance and reinsurance can play.
Beale said that the actions of global politicians and business leaders was the best way to rebuild trust, referring to the lack of trust that society has in many institutions.
Beale explained, “Many people are losing faith in the ability of the world’s political and economic systems to come up with the answers to the challenges they face. They feel that their societal and economic concerns – like globalisation, equality, the pace of technological change and eroding social values – are being ignored. We have to remedy this if we are to rebuild trust and faith in the system.
“There are no shortage of opportunities for us, as leaders, to take the action that can regain that trust. As CEOs I believe we need to think more carefully about our relationship with the wider world and how the decisions we make can affect public trust.”
Re/insurance has a role to play here, Beale said, based on the promises to pay that it makes to its policyholders.
She continued, “When I think of the insurance sector. Our model is built on trust. If we don’t live up to our promise to pay then we lose customers. It is a cornerstone of our decision making whenever a claim comes in. We don’t get it right every single time. But we value above all else the bond of trust that exists between ourselves and our customers.”
Beale also noted that organisations can better align themselves with societies expectations of them, by becoming more responsible in their day-to-day activities.
“I believe, for example, that there’s more the insurance sector could be doing to help the world transition to a low carbon economy. We can influence behaviour through our investments by choosing sustainable or low-carbon stocks, for example.
“We talk of social responsibility, which means we must consider our moral as well as commercial responsibilities. As business leaders we should be thinking how our activities can build trust and public confidence and not just focus on the bottom line.”
She went on to highlight the vital role that insurance and reinsurance plays in society, particularly in the aftermath of disasters where timely claims payments can make the difference between recovery or otherwise for those affected.
“The insurance sector has a particularly important role to play in society. Our claims payments, for example, provide all manner of economic and societal benefits particularly in the aftermath of a disaster, by helping businesses reopen quickly, restoring vital public services like power, or clearing roads, railways and airstrips, so commerce can be restored or vital aid delivered to those in need.
“Meanwhile, the insurance decisions we make support many of the developments that benefit economies and communities. Take, for example, agricultural insurance, which protects crops in disaster prone regions against weather damage, giving farmers the confidence to invest in the future.
“Furthermore, the decisions we make on pay and on hiring a diverse workforce that reflects the world around us have the power to shape the society we live in. We can tackle distrust by fostering a more open and inclusive culture in our organisations, where differences are celebrated. Working together I believe we have the power to create a stronger, more resilient society, with inclusive prosperity for all,” Beale said.