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Swiss Re has highlighted the increasing importance of advanced analytics and artificial intelligence (AI) in enhancing customer engagement and boosting sales within the insurance industry.

Recent research from the company has shown that “customers identify artificial intelligence as a key driver of better experience,” signifying the pivotal role of AI in not only boosting sales but also in shaping consumer expectations.

Daniel Levy, principal risk consultant at Swiss Re, pointed to AI’s potential in personalizing customer interactions in his latest discussion. This approach not only retains customers but also enhances the quality of interactions. Traditional propensity models are now seen as insufficient when not paired with other strategies. According to Levy, “Propensity is not perfect,” and a more diversified approach is necessary to realize greater returns on investment, particularly when customer interactions are low-cost and involve a large segment of the customer base.

He advocates for the use of multiple AI tools to achieve better returns on investment, particularly in scenarios involving inbound inquiries or broad customer bases. The company underscores the limitations of single-solution reliance and promotes diversified AI application.

In addition, Levy pointed out the effectiveness of behavioral segmentation models, which categorize customers based on behavioral patterns rather than demographic data. Such models have proven superior in engaging customers, as they provide insights into customer motivations and enable tailored communications. For instance, one client saw a 33-fold increase in customer action from those identified as highly active compared to those with lower activity levels.

Behavioral insights also help in understanding nuanced customer motivations, which can differ significantly even within similar demographic groups. Recognizing these differences allows for more effective and personalized customer outreach.

Levy also touched on the ethical considerations of AI usage, emphasizing the importance of transparency and responsible application. The company suggested that without proper oversight, the use of AI in crafting personalized messages could lead to ethical concerns, especially if the rationale behind certain communications is not clear.

“That said, these models raise possible ethical issues which need to be factored into any responsible company’s strategy. Unlike with behavioural segmentation, it is not always clear why a propensity model chooses a particular message, and the difficulty of explaining results can raise questions. For this reason their usage needs to be monitored carefully,” Levy said.

Howden Re, Howden Group’s reinsurance and risk advisory arm, has released a report on the landscape of cyber reinsurance.

In its ‘Re-framing cyber risk: navigating threats and embracing opportunities’ report, the firm found that the rewards that are offered were usually underestimated relative to the exposure to a natural catastrophe.

“Cyber risks consistently top the rankings of risk managers’ concerns. To stay relevant to those buyers of insurance, as an industry it is imperative that we embrace this class of business,” said global head of cyber at Howden Re, Luke Foord-Kelcey.

“This report identifies how carriers may assess their appetite for the cyber class of business to ensure they recognise the extent of the opportunities within the context of a more thorough understanding of the risks.”

The report found that larger carriers had an amount of natural catastrophe risk that was disproportionate in comparison to cyber risk. Cedents that have a smaller balance sheet were more exposed to cyber as a percentage of business mix.

“The maturing of the cyber market necessitates a thoughtful recalibration of how cyber risks are underwritten. A transition is necessary: from viewing cyber threats through a catastrophic lens, and instead recognising the competitive advantage that can be gained through more nuanced and informed risk analysis,” said head of industry analysis and strategic advisory at Howden Re, David Flandro.

Through the report, Howden Re concluded that reinsurers will be able to have a more favourable and diversified risk-return profile from cyber reinsurance underwriting should there be a continuous investment in expertise, modeling, and analytics.

“Investing in cyber-specific expertise and leveraging refined risk models are key to navigating the complexities of cyber threats effectively,” said Foord-Kelcey.

 “This approach will not only transform perceived vulnerabilities into competitive advantages, but also enable our clients to capitalize fully on the burgeoning opportunities in today’s digital landscape.” 

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BMS Re, the specialty reinsurance division of the global broking group BMS, has announced the addition of six new hires to its growing MGA business, ProLink Solutions.

The new team members include Alicia Santocki, joining as executive vice president, Scott Fields and Stephanie Fick as senior vice presidents, Colin Curran and Charles Ill as assistant vice presidents, and Cora Cruz as an executive assistant. In addition, Brenda Martinez-Cox has been promoted to technical broker.

ProLink Solutions was established within BMS Re in mid-2023. It has since managed programs with premiums across its business portfolio now nearing $6 billion. The business has cultivated relationships with over 50 insurance carriers, working with 20 of the largest MGAs/MGUs, and engaging more than 80 program managers. These new hires reflect a 40% increase in ProLink’s personnel, taking the total team size from 15 to 21.

Santocki brings to the role extensive experience from GMG Assurance and Freeman Mathis & Gary, LLP, the news release noted. Fields joins ProLink Solutions from a previous role as managing director at a captive management company in Atlanta. Fick’s most recent experience was at Swiss Re as a senior treaty underwriter. Curran comes from Berkley Asset Protection, Cruz from ScotiaBank Equity Capital Markets, and Ill from Aon. Martinez-Cox’s promotion to technical broker follows her stint at BMS Re, starting in January 2024.

“With these appointments the team at ProLink Solutions goes from 15 to 21 people, a great marker of how much we have been able to expand in a year. The new appointments bring a mixture of fresh talent and industry experience which will strengthen the team in all areas, supporting our clients as demand continues to grow, and building on the excellent platform ProLink has developed so far,” said Desmond Bonhan, managing director at BMS Re ProLink Solutions.

John Speckman, also a managing director at BMS Re ProLink Solutions, echoed the enthusiasm.

“The substantial growth of the ProLink Solutions team is propelled by demand, showcasing our swift expansion and prominent position we’ve achieved in the programs space within just a year of inception. Desmond and I are delighted to be welcoming our new colleagues and the expertise and capability they will provide to our clients and partners,” he said.

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Qatar Insurance Company (QIC Group or QIC) has announced a net profit of QAR 194 million for the first quarter of 2024 (Q1 2024), up from QAR 175 million for the same period in 2023.

The company’s board of directors, led by Sheikh Hamad bin Faisal bin Thani Jasim Al Thani, reviewed and approved the results during their April 29 meeting.

Qatar Insurance Company’s growth in Q1 2024

Chairman Sheikh Hamad bin Faisal Al Thani said QIC’s financial position remains robust, with the company building on progress made last year by focusing on profitable operations in Qatar and the wider MENA region while reducing its exposure to underperforming international markets like the UK.

“QIC begins 2024 in excellent financial health. The first quarter of the year saw the company consolidate and build upon the progress it made over the previous year – with a renewed focus on strengthening profitable domestic and regional businesses, extending its exceptional digital offering, and strategically improving its international operations while reducing exposure to underperforming markets. In spite of a global macroeconomic environment that remains uncertain in the near term and geopolitical challenges, QIC continues to enjoy robust growth through its core business lines, strong financials, and stable sources of income,” he said.

Supply chain disruptions linked to Brexit have increased volatility and risk in the UK motor insurance market. This volatility led QIC to scale back its UK motor insurance operations while focusing on its online motor insurance offerings in Qatar and MENA markets.

QIC Group CEO Salem Khalaf Al Mannai described the Q1 results as encouraging and mentioned significant growth in the MENA direct insurance sector.

Gross written premiums stood at QAR 2.75 billion, which was attributed to a strategy of expanding within domestic and regional markets.

“QIC’s digital innovation in particular continues to be a key point of competitive differentiation for the company. Through multiple new features introduced to the online and mobile platforms in Q1 2024, our customers in Qatar and across the GCC can expect unparalleled convenience when onboarding and fulfilling their digital needs, which is reflected in the record numbers of users that are now utilising these channels,” he said.

Qatar Insurance Company earns awards

The company also received accolades, winning the “Insurer of the Year in Qatar” and “Best Travel Insurance Company in the Middle East.”

“QIC is proud to once again have been named ‘Insurer of the Year in Qatar’ at the MENA IR Awards 2024, for the third consecutive year and ‘Best Travel Insurance Company in The Middle East’ for the second consecutive year at the Global Banking & Finance Review Awards 2024. The company has also engaged in a number of exciting recent initiatives – from operating an innovation-focused booth at Web Summit Qatar 2024, the world’s largest tech conference, to promoting insurance literacy in Qatar through a new Edutainment establishment for young people,” Mannai said.

Qatar Insurance Company’s investments

Despite global macroeconomic uncertainty and natural disasters impacting the sector, QIC saw an investment income of QAR 227 million in Q1 2024, up from QAR 223 million a year prior. In addition to the economic landscape, events like flooding in the UAE and the Francis Scott Key Bridge collapse in the US will influence future insurance claims and market dynamics.

QIC’s strategy focuses on strengthening its profitable markets in Qatar and the MENA region while reducing its footprint in less profitable international markets. The gross written premiums for domestic and MENA operations reached QAR 1.4 billion in the first quarter, compared to QAR 0.9 billion in Q1 2023. Health and life insurance now represent a more significant share of gross premiums.

Digitally, QIC introduced personalised onboarding streams and optimised its mobile and web platforms across Qatar, the UAE, and Oman. These efforts improved turnaround times and helped reach record levels of digital sales in key personal lines.

International General Insurance Holdings Ltd (IGI) has announced its financial performance for the first quarter of 2024.

Gross written premiums reached $181.6 million, up 4.4% from $173.9 million in Q1 2023. Net premiums earned also saw growth, rising to $114.5 million from $105.1 million.

The company reported a significant increase in underwriting income, which reached $52 million, a 30.7% increase over last year’s $39.8 million.

Meanwhile, net investment income improved to $15.4 million, compared to $12.4 million in 2023. This growth led to a net income of $37.9 million, up from $33.9 million, with an annualised return on average equity of 27.6%. The combined ratio also improved, reducing to 74.1% from 78.4%.

“IGI had a very positive start to 2024, posting another excellent set of financial results for the first quarter. While market conditions are more mixed than a year ago, we continue to benefit from the strong foundations that we’ve laid over recent quarters and years to position our company for continued success,” said IGI president and CEO Waleed Jabsheh.

Q1 2024 performance of IGI segments

Breaking down segment results, the specialty long-tail segment recorded a drop in gross written premiums to $38.7 million, down 7.9% from the previous year’s $42 million.

The specialty short-tail segment reported gross written premiums of $94.2 million, a 2.8% increase, and the reinsurance segment saw a notable increase, with premiums rising to $48.7 million, up from $40.3 million.

IGI’s net foreign exchange loss in Q1 2024

The company faced a foreign exchange loss of $4.3 million in Q1 2024 due to adverse currency revaluation, compared to a $1.3 million gain last year. The pound sterling and euro depreciated against the US dollar, driving these movements.

IGI’s Q1 2024 investment results

The company’s investment income reached $15.4 million, compared to $12.4 million a year earlier, as rising interest rates and a larger investment portfolio pushed yields to 4.2% from 3.5%.

Allianz Trade has announced a partnership with Inclusive Brains, a French start-up focused on generative artificial intelligence (AI) and brain-computer interfaces (BCIs), to create Prometheus—a new brain-machine interface. According to a news release, this technology aims to enhance the lives of individuals with disabilities by allowing them to control digital environments and operate devices without using their hands or voice.

Prometheus is designed to translate neurophysiological data—such as brainwaves, heart activity, facial expressions, and eye movements—into mental commands. This technology holds promise for individuals who have lost mobility or the ability to speak, offering them a new way to engage with the world. It can potentially be used to control workstations, navigate digital environments, and operate connected objects, providing greater autonomy to those with physical limitations.

AI and neurotechnology for inclusivity

Inclusive Brains, founded in 2022 by neuroscientist Olivier Oullier and AI expert Paul Barbaste, developed Prometheus to help people who have lost mobility due to accidents or neurodegenerative diseases. The company’s mission is to improve inclusivity by combining generative AI with BCIs. “True inclusion means developing solutions that assist each and everyone of us, with no discrimination whatsoever,” said Oullier, CEO of Inclusive Brains.

Prometheus has already demonstrated its capabilities in usability tests, allowing users to control an exoskeleton arm through brain signals, facial expressions, or other neurophysiological cues. These tests were conducted with organizations supporting people with cognitive disabilities and paralysis.

Allianz Trade, through the partnership, brings resources to the Prometheus project, providing financial, strategic, and logistical support.

“We are proud to partner with Inclusive Brains to leverage AI and neurotechnology for positive social impact,” said Aylin Somersan Coqui, CEO of Allianz Trade. “Inclusion is a core value at Allianz Trade. We believe in the power of innovation to support it.”

Coqui noted Allianz Trade’s support will enable Inclusive Brains to advance the Prometheus BCI’s research and development, acquire physiological sensors, and provide exoskeleton arms to non-profit organizations supporting people with paralysis. Additionally, the company aims to make the Prometheus AI model open source, encouraging further development of assistive technologies.

Prometheus will be publicly demonstrated during the upcoming Olympic Torch Relay. A torch bearer with motor disability will use the technology to control an exoskeleton arm, showcasing the potential of AI-powered assistive technologies. The news release notes this event aims to raise awareness about the importance of supporting scientific and industrial efforts to improve inclusivity in the workplace and beyond.

Looking to the future

The partnership between Allianz Trade and Inclusive Brains is poised to create lasting impact by developing technologies that foster inclusion and accessibility. The collaboration also envisions other concrete use cases, such as mind-controlled keyboards and AI applications to improve workplace safety. “We are convinced that generative AI combined with cutting-edge neural interfaces will accelerate the integration of people with disabilities and benefit all individuals equally,” said Coqui.

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Prospective Everton Football Club buyer and re/insurance holdings firm 777 Partners finds itself in further hot waters, facing troubles with a ratings agency in one hand and a fraud lawsuit in the other.

Two US insurance firms, Atlantic Coast Life Insurance and Sentinel Security Life Insurance, part of the A-Cap insurance group, have initiated legal action against the rating agency AM Best following its supposed “fixation” with 777 Re, a Bermuda-based reinsurer linked to the Miami-based investment group.

The insurers are seeking to prevent AM Best from downgrading their financial strength ratings, which could potentially drop from B++ to B-. The lawsuit was filed last week in a New Jersey court.

Concerns have been raised by AM Best regarding the quality of assets held by the reinsurer, prompting A-Cap to reclaim assets previously ceded to 777 Re through reinsurance transactions. This action follows regulatory pressure to lessen their exposure to the investment firm.

In their legal filing, the insurers argue that AM Best’s impending rating downgrade is based on a misinterpretation of their relationship with 777 Re and an overly pessimistic assessment of the reinsurer’s assets. They also claim that AM Best’s review process was erratic and failed to consider the insurers’ recent progress in reducing their exposure to the reinsurer.

The insurers also cited an email from AM Best indicating an intention to apply $1 billion in writedowns, predominantly on assets external to the A-Cap insurers’ financial books.

The legal complaint includes accusations against AM Best for employing “flawed methods, improper assumptions, and demonstrably false data” in their evaluation process. According to the insurers, this led to arbitrary and capricious rating changes that do not reflect the actual business operations or cooperation extended by the A-Cap insurers.

In addition, the insurers highlighted their recent success in recapturing $510 million worth of assets related to 777 Re, which have now been transferred to a new insurer at par value. They anticipate fully eliminating their exposure to 777 Re by the end of the month.

AM Best has not yet responded to the allegations, and A-Cap has indicated that the matter is currently under litigation.

Fraud lawsuit versus 777 Partners

777 Partners is also facing accusations of fraudulent activity amounting to hundreds of millions of dollars, as alleged in a lawsuit filed by London-based asset manager Leadenhall Capital and its affiliate Leadenhall Life.

The complaint, lodged in a federal court in New York on Friday, claims that 777 Partners and its co-founder Josh Wander engaged in fraudulent activities involving assets worth over $350 million that were either non-existent, not owned by Wander’s entities, or previously pledged to another lender.

According to the lawsuit, Wander acknowledged issues caused by “777 Partners’ antiquated computer system,” describing them as a “screwup” and “embarrassing”. A spokesman for 777 Partners declined to comment on the matter.

This lawsuit adds to the trouble surrounding 777 Partners’ ongoing efforts to acquire Everton Football Club, a process marred by delays and yet to receive approval from the Premier League. The league has stipulated that 777 Partners must meet several conditions to proceed with the takeover, including the repayment of a £158 million debt related to Everton’s new stadium construction, primarily financed by MSP Sports Capital.

The lawsuit also touches on the intricate relationships and financial dependencies involving 777 Partners and A-Cap. Leadenhall’s filing accuses A-Cap of being a crucial supporter of 777, allegedly managing crises in a “Whac-A-Mole” fashion to temporarily stave off creditor actions and public exposure of the ongoing financial schemes.

In response, A-Cap has vigorously denied the allegations, describing Leadenhall’s claims as “sensational and unfounded”, and indicative of a desperate attempt to prioritize its claims over those of other creditors.

A spokesperson for A-Cap emphasized the firm’s commitment to defending its interests and those of its policyholders, underscoring its position as a senior creditor to 777 with no ownership ties, contrary to the assertions made by Leadenhall.

Leadenhall, meanwhile, stated that its lawsuit aims to maximize returns for its investors, highlighting the legal steps it is prepared to take against 777 Partners and associated entities.

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Munich Re‘s REALYTIX team has introduced a new generative AI function, a GenAI-Co-Pilot, on its REALYTIX ZERO platform.

This new tool is designed to streamline the development of insurance products for its clients.

The GenAI-Co-Pilot also marks Munich Re’s first deployment of generative artificial intelligence in an operational setting. This technology is aimed at aiding clients, including primary insurers, in crafting specialized insurance products more efficiently.

Utilizing the platform, the AI assistant processes user inputs, known as prompts, and rapidly crafts these into detailed insurance product proposals. These can then be approved and implemented via an online product studio within hours.

Florian Niklas, CEO and co-founder of REALYTIX ZERO, commented on the launch and its importance as a milestone for the company.

“We launched as a Munich Re corporate startup in 2018 to provide our clients with the highest level of underwriting and product development expertise according to the latest standards. Today, generative AI supports us in this,” he said.

Since its inception in 2018, the cloud-based REALYTIX ZERO has served as a comprehensive underwriting platform, leveraging Munich Re’s underwriting knowledge to support the digitalization and automation of underwriting processes for insurers, MGAs, and brokers. The platform allows these entities to integrate their digital offerings with Munich Re’s capacities, facilitating quicker and more streamlined business operations through digital channels.

This automation, Munich Re explains, not only enhances the quality and consistency of product designs but also reduces the costs associated with development and increases transparency in product logic and premium calculations.

Currently, over 50 clients globally in the non-life insurance sector utilize the platform. Munich Re plans to continually enhance the co-pilot’s functionalities based on user feedback. The incorporation of generative AI into the platform is expected to further simplify its operation, promoting broader automation within the insurance industry and unlocking significant cost savings.

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New York-based alternative asset manager Third Point has announced the launch of Malibu Life Reinsurance SPC (Malibu Life Re), a new life and annuity reinsurer established in the Cayman Islands.

Malibu Life Re will concentrate on asset-intensive reinsurance solutions and has already secured an agreement with a prominent US annuity provider. This arrangement involves reinsuring $3 billion worth of annuity products through a quota share flow agreement.

Third Point will support Malibu Life Re with investment management and strategic services, leveraging its experience in excess spread sourcing across various credit asset classes and portfolio management.

The strategic services will encompass corporate development, risk management, and asset liability management, with a focus on developing tailor-made, liability-driven investment programs.

Daniel S Loeb (pictured above), founder and CEO of Third Point, expressed optimism about the new reinsurance venture.

“We are excited to form Malibu Life Re to provide attractive capital solutions in the life and annuity space in partnership with leading insurers,” Loeb said. “We expect that the nimble, multi-asset class investment strategy we have designed over almost thirty years can be leveraged to deliver favorable long-term risk adjusted returns for Malibu Life Re’s clients and partners.”

Supporting the launch, Lazard served as the financial advisor, and Oliver Wyman provided actuarial support. Legal advisory was handled by Debevoise & Plimpton LLP and Conyers Dill & Pearman LLP, with Artex Risk Solutions acting as the insurance manager.

Malibu Life Re operates as an independent, Class B(iii) reinsurer, owned by Third Point and its affiliates. It aims to establish reinsurance relationships with leading life and annuity providers, capitalizing on Third Point’s expertise in investment and risk management.

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