Speaking to The ReInsurer, Best-Devereux highlighted the success of digital trading and the (re)insurance sector’s reliance on digital platforms and technology as a result of the mass home working spurred by the Covid-19 pandemic.
“What we’re seeing is a real change in the way people are working,” he explained in a video interview.
“We’re not going back to the old normal. The change has now been going on for six months and people have learnt that they can work from home well and work remotely.”
A reliance on technology means that firms must be increasingly “tech-savvy”, said Best-Devereux. For those that adopt technology, the dividends can be huge but those who fail to keep up may be left behind, he warned.
“There will inevitably be winners and losers, particularly losers who are not tech-savvy. The writing is on the wall as far as this is concerned,” he added.
“What we are going to find is that lots of companies have their own approach to that. There will be multiple platforms and we certainly view ourselves as an important member of that community but we will not be the only one in reinsurance.”
Best-Devereux warned against monopolistic market utilities and instead predicted that there will be “tens and not hundreds” of platforms in future but that all of these platforms will be able to talk to one another.
Efficiency and cost savings remain a “critical” concern to the market, he added noting that an increasing reliance on e-placement and technology will help strip cost out of the system and free up capital to help cover emerging risks.
“The total cost of distribution has obviously attracted a lot of attention in the last few years. But If the market is going to be sustainable, if it’s going to address and help solve the management of problems such as pandemic or climate change, that cost is going to have to come down so that more of that premium can go to the risk,” he said.
Best-Devereux likened the wave of innovation in the market at present as being akin to the “enormous impact” of technical innovations that swept the market in the 1980’s thanks to the internet and desktop computing.
Platforms which network people together, will become increasingly important and the role of Lloyd’s as a place to transact face-to-face remains “critical”, he added.
“You cannot live in your own bubble and have to be out alongside competitors, talking to them, and understanding the market. A lot of that can be achieved in a digitally networked environment,” Best-Devereux said.
As the market shifts to digital platforms, eReinsure’s experience, its 40,000 global users, and its focus stand the electronic placing platform in good stead for growth, he said.
“There is a surge of interest but not everybody who is responding to that has that kind of experience,” Best-Devereux noted.
“We have the advantage of 20 years of experience,” he said. “We’re working hard to take that knowledge, improve our system and our capabilities and add real value to the market.”