Renewals: delivering answers, not outputs, using data and analytics

The ability to present reinsurers and other stakeholders with the best possible data and analytics in what could be a very challenging renewal will make a big difference to cedants and help them get the capacity they need.

But such outcomes cannot be delivered with a reliance on the output of models and default tools alone—how data is interpreted is key. This requires a very client-focused approach and the right analyses assembled in a way that is easy to consume and complete.

That is the argument of Kirk Conrad (pictured), global head of analytics at BMS Re, who explains that this philosophy underpins the broker’s approach to the challenge. BMS Re unveiled Pathlight Analytics 18 months ago, which represents the catch-all brand for its modelling and analytics platform but also the way it interprets and uses that information.

“Pathlight Analytics is not a tool or technology—instead it describes our philosophy and culture of using data and analytics to deliver the answers our clients need to achieve their goals,” Conrad explains.

“Our Pathlight Analytics platform allows cedants to differentiate themselves in their own strategies and marketing efforts and as part of the reinsurance process. We recognise and embrace that all the stakeholders involved want to use data to make decisions and we work with our clients to lead with the data that matters to those stakeholders.”

He adds that the key to success is listening and focusing on what matters to clients. “We have found that if we fully understand the challenges our clients face and the goals they are trying to achieve, we are better positioned to deliver the answers they need.

“We are here to help clients solve problems and achieve their goals. We do that by focusing on delivering answers, not thoughtless outputs.”

Four pillars

Conrad says clients’ goals and challenges tend to fall into one of four categories: protecting the balance sheet; informing them of trends in the industry or impactful events; growing profitable books; and improving results. These four pillars are used to describe BMS Re’s analytic offerings within Pathlight Analytics.

“We want our clients to treat their data as a true asset, invest in the data capture, and make decisions using that data,” Conrad says. “We help them enrich what they have or help them capture better data. Great stories are wonderful, but people live and breathe data.

“It’s the language of the re/insurance world. It is essential to have the data to back up decisions. We’re not here just for the reinsurance transaction, we are here for a partnership with our clients, and this is one of the ways we act as a partner.”

Reinsurance placements are essential, but Conrad stresses that broker relationships should not be based just on an annual transaction. Instead, it should be a year-round partnership facilitated by the broker but based on a deep understanding of the underlying business. Over time, through collaboration with clients to enhance their data, this partnership model delivers superior results.

“That makes a huge difference to reinsurers and other stakeholders. Because of how we work, we get a lot of feedback that our submissions are very well received. We understand how the market is going to look at things. We help our clients understand that view and think about how we can work together to work through potential challenges or difficulties that may arise from various views and biases,” he says.

“With that knowledge, we focus on making the information easy for markets to consume and review and we also try to address items that we know are going to raise questions in advance rather than waiting for the questions to come in over time.

“We share our view on results when possible. We want to make sure there is not a delay for markets to get the information they need to do their job. All that upfront work allows us to focus on the analysis and results and not waste time helping to get information organised and ready for the analysis based on varied market preferences.

“We embrace the data and make it easy to work with us and our clients—the investment up front pays dividends down the road to all the stakeholders involved.”

This approach will be more important than ever in the current hard market, and is only likely to get harder in the aftermath of Hurricane Ian.

“We are in for challenging renewals given the activity we’ve had over the last several years. We need to be laser-focused on making it easy for the reinsurers and other capacity providers to understand the story and buy into what’s going on with our clients.

“The Pathlight Analytics team has a relentless focus on providing the right data to back up decisions and strategies in an easy-to-consume format, and that will set BMS Re clients apart.”