Seeing the world through new eyes

Insurers are guilty of spending too much time navel-gazing rather than thinking about customers. This, argues Stuart Sutherland, Liberty Specialty Markets’ head of casualty, has to change.

Richard Feynman was a Nobel Prize-winning physicist who developed a reputation for solving mathematical problems that the finest minds of his generation could not fathom. In his autobiography, Feynman revealed the secret behind his abilities. It wasn’t that he was more intelligent than his peers, but his insatiable curiosity and desire to master subjects gave him a different way of looking at problems.

The example of Feynman shows just how important perspective and mental flexibility are to achieving success. In short, the greater our ability to experience a challenge from differing perspectives, the greater our chance of finding a workable solution.

By way of contrast, consider an insurance company: a business entrenched in well-trodden practices surrounded by competitors and removed from its end customer. Is it any wonder that its world view is shaped by its inner workings rather than the experience of policyholders?

Change is the answer, but not just any change. We need change that’s driven by customer-centric thinking, as opposed to a desire to achieve compliance or to stem the potential for damaging litigation.

Combine P&C to respond to sector needs

Clients’ boards are taking an increasingly holistic view of risk, so they need insurance providers to do the same. This is why I’m advocating that we at Liberty should combine our traditional property and casualty offering into one seamless insurance solution, tailored for industry sectors across multiple territories in which we specialise.

Of course, this is how the professional services industry has worked for many years. For example, rather than promoting auditing or dispute resolution services, accountants and lawyers have long gone to market on a sector basis. Although the services offered may be broadly similar, customers access them through a team that specialises in their sector.

Importantly, the sector approach is not just a marketing construct, it is an organisational reality. This enables firms to apply global best practice when delivering local client service. While it’s true that the insurance industry does have some specialist industry teams, behind the scenes it is often the insurance line that informs team structure.

Our transformation will go beyond joining up the property and casualty offering via an industry sector approach. We are building our multinational capability on a UK and global hub basis, while looking to deploy our capacity through greater use of delegated authorities and managing general agents. This will enable us to pursue particular books of business while supporting existing business more efficiently.

Change the paradigm

Another departure from traditional practice will change the way Liberty Specialty Markets deploys its underwriting resource. In time, we will create a distinction between field underwriters, who interact with brokers and insureds, and technical underwriters.

Field underwriters will work with specialist risk engineers and claims experts, interacting directly with brokers and insureds. This will bring us much closer to changing market needs and help drive the development of specialist products. In time, it might enable us to extend our offering beyond traditional risk transfer.

Technical underwriters will be less involved in product development. Instead, they will operate behind the scenes, spanning both the company and Lloyd’s platform, enabling us to write risks and deploy capital more flexibly and efficiently.

Think big, and long-term

It would be foolhardy to break the mould before the market is primed for change, or the organisation can adapt, but the process begins now. Liberty Specialty Markets is alive to the need to reinvent itself. Our mutual heritage enables our management team to take a longer-term view and embed necessary changes behind the scenes that will transform the way we go to market.

Although this represents a significant strategic shift for us, the bones of the novel approach are already in place. As an industry that’s hundreds of years old, the manner in which we see the world has become hard-wired. It’s time to see the world through new eyes.

Stuart Sutherland is head of casualty at Liberty Specialty Markets. He can be contacted at: marketingteam@libertyglobalgroup.com