What do you see as the most critical issues for P&C industry?

SK: There will always be immediate, bottom-line issues that I.I.I.’s members care about. Some issues will be the same whether it’s in workers’ comp and understanding various components of workers’ comp claims or as we’re seeing right now, a rise in the severity and frequency of auto accidents. Those issues continue to be the main focus, but there are evolving issues that could have dramatic impact on the industry like digitalization, the sharing economy and big data.

First and foremost, the P&C industry needs to stay focused on the fundamental bottom line for insurance as a business. It’s also important for their customers who need to understand the value of insurance as a whole, what it is and how it benefits them, and to gain more trust in insurance companies.

Do you see the trend of P&C carrier consolidation continuing?

SK: The current economic outlook certainly seems to indicate that consolidation is likely to continue but it’s difficult to predict specifics. The P&C industry is not going to shrink as much as the health care markets, but the future of the industry isn’t clear yet.

Where do you think the P&C industry is heading, both in the short term and the long term?

SK: It’s difficult to predict but change is inevitable, whether through some consolidation in the industry or the other disruptors that the industry is facing.

The rapid changes in technology and digitalization are key elements of change for the P&C industry; it’s only a question of how or when, which are still unknowns. I.I.I. is doing extensive research in this area, and I foresee this evolving.

For the industry itself, it’s going to come down to the increased potential for new competition. Some of the fundamentals of insurance are also undergoing change, for example, productivity, claims handling, even underwriting and how technology plays a role in all of them. Even the most fundamental role of insurance in risk pooling could change in the era of big data and how granular you can get.

I.I.I. will be actively engaged in helping the industry understand what this all means and helping our members understand how they may want to embrace the changes.

Continue reading...

Do you think there will be a trend or push by the industry to have the government step in as an insurer of last resort in more areas than it already does, for example, beyond flood and terrorism?

SK: Where I see things going with government intervention is mostly likely around resilience, focusing on the potential for various catastrophes, where they’re going to happen, and the ability to create more resilient communities. Whether it’s flood or cyber [risk], for example, the insurance industry and governments at all levels are going to have to work together and create a better understanding of how we can make communities and businesses more resilient to catastrophes we know are coming — whether natural or man-made.

There are infrastructure problems throughout country and the world. As projects are under way to upgrade or rebuild, we need to factor in resiliency to natural catastrophes and other disasters.

How do you think your background will help you at I.I.I.?

SK: I’ve spent my career working in all the elements of public affairs, which I break down into four areas:

1. Government regulators and policy makers.

2. The business community, which includes the individual businesses themselves as well as trade associations.

3. Relevant subject matter experts, such as academics and think tanks.

4. And media, including trade publications as well as the general press.

For me, the interesting thing about I.I.I. is that the organization straddles the business side of things as a trade association in some ways. At the same, they have the relevant subject matter experts and operate as a think tank. They provide objective and credible facts, statistics and information to the P&C industry as well as the general public, so I think it’s a good fit for me.

How do you see I.I.I. changing as the P&C industry evolves?

SK: I.I.I. will continue to do what the organization has done so well over the years under Bob Hartwig’s leadership and with his team. First of all, maintaining objectiveness when looking at the information and letting the facts and statistics speak for themselves. I.I.I. does a great job of gathering information and helping members and other key stakeholder groups understand what the information means, and I expect that to be an important role that we’ll continue to play with those immediate issues that we’re seeing right now as well as the ones that are evolving and changing the industry in the future.

Bob and his team built a great foundation at I.I.I., and I look forward to continuing to build the best organization we can.

Related: Insurance Information Institute names Sean Kevelighan president and CEO