Supercede’s Rose on why reinsurance needs a unified system for doing business

The re/insurance industry has gained something of a reputation for failing to roll with the times.

While other segments of the financial services world have moved on from pen and paper to a greater or lesser extent and embraced digital transformation, re/insurance remains somewhat behind the times, even with the rise of insurtech and an explosion of startups over the past decade.

The problem is most acute in the reinsurance market, where ungainly Bordereaux and the relentless back and forth of physical documentation or splintered spreadsheets persists, meaning that business remains conducted in a haphazard fashion with few, if any, unified platforms for transacting.

Ben Rose, co-founder and president of reinsurance ecosystem platform Supercede, sat down with the 1.1 Club, Intelligent Insurer’s online, on-demand platform for one-on-one interviews with industry leaders, to discuss how the reinsurance world can develop its tech offering for providers and clients alike.

With time spent working at Lloyd’s of London syndicates and reinsurance brokers, Rose has first-hand experience of how challenging parts of the reinsurance ecosystem can be for users.

He eventually channelled that frustration into the founding of Supercede in 2019 with an explicit aim to improve the technological infrastructure of the market and bring the reinsurance market up to speed with developments on the primary side over recent years.

“For us it was mostly frustration that reinsurance was a bit neglected when it came to technology solutions. We saw a number of things coming up that were looking at insurance and how we could make insurance digital,” Rose said.

“When it came to reinsurance, that was always an afterthought, or something we’ll get to later. We thought the reinsurance industry deserves to have technology all for itself.

“We set out to build an independent company that could provide that technology to bridge the gap between all the participants: cedants, brokers, and now the reinsurers in our space.”

One of the major problem areas the company has faced when trying to build a unified system for use by anyone in the market is its splintered nature.

Rose says that while existing companies have attempted to build something similar in the past, the competitive nature of the marketplace has meant that others have been reluctant to get on board, showing the need for a neutral party as a hub on which others can transact without ceding ground to potential rivals.

“The primary challenge we’ve had is probably one of fragmentation. Another reason we set out to build Supercede as a neutral company was because it didn’t seem possible that any one reinsurer could build a shared infrastructure for reinsurance.

“We needed to get people away from a purely offline way of doing business and into an online means of working,” he said.

“If Swiss Re builds something, then Munich Re probably wouldn’t want to use it. That’s where we need a neutral platform to be built by people in the industry, so that we have a chance of getting some digital infrastructure between us without having to rip up the playbook of how we do business, and making it easier to share data between each other at the same time”

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All that data

The ability to effectively manage the reams of data and information that the market produces is another significant challenge facing the industry, Rose says.

As more data have become available and with Excel spreadsheets groaning under the weight of information, it has become clear that a better way of managing that data is sorely needed.

“We still have a data problem. The industry has historically relied very much on trust between people—the good word of the reinsurer and the insurer to provide a fair presentation of risk in one direction, and a good coverage, guaranteeing the other,” he said.

“But as we start to exceed Excel’s one million row limit, spreadsheets are starting to break. We’re all starting to struggle under the weight of data manipulation, and having to deal with copying and pasting things out of spreadsheets, and trying to search and find stalking policies buried in submission packs.

“We’re trying to join up the very complex operations of global organisations that these days have been strung together across many different mergers and acquisitions, and many different systems, over time.

“At the moment we’re having to use trust, but the known unknowns are ever more known. People are much more aware of what they aren’t able to look at, but feel like they should be able to investigate and interrogate before buying coverage, placing or underwriting it.

“Those gaps are becoming more and more obvious, as we think: why don’t we have this data? That’s something that also keeps coming up as a major challenge,” he concluded.

To view the full 1.1 Club interview click here