ldoherty

As part of the deal, Flint Insurance will become a GRP retail hub, with its 126 employees – including vendors Darren and David Taylor – remaining in the business. It will also continue to trade under its brand and operate out of its Orpington and Chelmsford offices.

Flint Insurance managing director Darren Taylor commented that the company had tremendous success as an independent broker. However, becoming a part of GRP – including Brown & Brown’s capabilities and investment – was compelling.

“We started talking to GRP some time ago, and while there were attractions to their private equity backing, once they had secured their ‘forever’ platform and we had a chance to meet the team who lead Brown & Brown, it was an easy decision,” Taylor said. “We have seen how the GRP businesses have grown to a new level of success as part of the wider group, and we are looking forward to further accelerating our exciting growth plans with owners who share our customer and employee-focused culture, including staff share ownership.

“The firepower that GRP and Brown & Brown can provide for growth-oriented businesses like ours is second to none in the market. Our clients and the Flint family – our fantastic team of people – will equally benefit from the wider range of products and services we can call on as part of a bigger group.”

GRP group CEO Mike Bruce hailed the latest acquisition, which has already received regulatory approval, as a significant milestone for the company.

“This acquisition underlines our continued appetite, despite the uncertain economic environment, for larger businesses that meet our strict quality criteria and are culturally and strategically aligned with us,” he said.  “Flint Group is a brilliantly run brokerage with highly entrepreneurial owner-managers in Darren, David, and their team, who will all fit superbly into our wider group. We look forward to supporting them as they begin the next stage of their successful journey as part of the GRP/Brown & Brown team.

“This acquisition underlines our determination to continue to grow our UK retail business division, utilising our hub and spoke strategy.”

Flint Insurance’s acquisition follows GRP-owned health insurance intermediary Premier Choice Healthcare’s dual deal earlier this month.

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What springs to your mind when you are asked to imagine a ‘typical’ hacker? For many, it’s a picture that has changed substantially in recent years – with the image of a hoodie-clad youth sitting alone in their room gradually being overlaid by market reports of highly sophisticated and well-structured organisations boasting teams of threat actors.

Find out more: Discover how Altus’ team can help you navigate today’s ever-shifting cyber landscape

However, as tempting as it can be to shift from one narrative to another, as with so much around cyber, the picture of the online threat actor landscape is more nuanced than any simple interpretation. This nuance comes back to the message central to the work that Aaron Cain (pictured) and his team at Altus are doing – creating accessible discussions around cyber risk without falling into the trap of assumptions and oversimplification.

Looking at the current risk landscape, Cain – a cyber security consultant with Altus – highlighted that cyber criminals, with exceptions, can generally be sorted into three categories. The first of these are state actors often assumed to be located in North Korea, Russia, several locations in the Middle East, or China. These are intelligent individuals who have been given a way out of poverty or into a better life than would otherwise be available to them.

“Nation-state groups create various pieces of malware – for instance, the WannaCry [malware] – that cyber specialists researched and saw it had North Korea’s or Russia’s or somewhere else’s fingerprints on it and thus could be identified as a state-sponsored attack,” he said. “So, states bring out something and it hurts their adversary’s marketplace and has an impact. However, once that impact is mitigated, they then take that packet of software and put it on to the dark web version of GitHub.

“The next category of hackers are those located anywhere in the world who then acquire that particular piece of malware. Where the nations have been using it at the state level, individuals can now use it at that next level – which is targeting corporations, small businesses, etc. They add their own wrappers, and if they’re smart enough, sometimes they recode it. In many cases, it comes with a complete operating manual on how to deploy it and how to get your payment out. ”

Cain noted that what makes this category of threat so daunting is that, with an internet connection and nothing else to do with their day, these hackers can be tireless in chasing one exposed prospect after the other. They’re not sophisticated, he said, but they don’t have to be because they’re using services somebody else has put together to relentlessly scan for any weakness in a business’s infrastructure.

Further compounding the issue is when the code becomes ‘Ransomware as a Service’ with hacking consortiums supporting users in these deprived areas. They invite successful hackers to join the business, he said, offering a monthly salary, skills upgrades, and English lessons among other perks. Having teams of such individuals hitting and re-hitting targets until something gives is still how a lot of cyberattacks are getting through.

“And are we going to put them in jail?” he asked. “We can find them, but even if we find them and pin down what it is they’re doing, what can we do? Absolutely nothing, because they’re in countries that don’t allow us to… So, when you’re dealing with that level of threat, you’re dealing with the major growth of the problem – like dust at the bottom of a cloud that just spreads and spreads.”

Read more: A shifting paradigm – how digital transformation is creating new cyber risk exposures

Considering the third category of risk, he said, corporations find themselves dealing with hacktivists – people who are morally outraged with an organisation and are looking for a way to do it damage. Traditionally, Cain said, the easiest way to hurt a company doing something you don’t like was to take its money away. Ransomware and denial of service attacks were the most popular way to do this, hitting a company financially while also doing reputational harm and raising the profile of the hacktivist’s cause.

“However, it’s a changing world,” he said, “and people have started to realise that even if I do get through, all that really gets affected is [my target’s] insurance. The attack is paid for, systems and services are restored, and it hasn’t really done what I wanted it to do. So, ransomware is starting to evolve into new threats like wiperware. Basically, instead of going in and encrypting systems, they’re deleting things, so you end up with machines with no data, no operating system and nothing left.

“And if they can find it, they will go after your backups as well so you can’t restore that data. This at least stops the organisation from doing whatever evil they perceive it’s doing for an indeterminate period of time until it’s brought back online. Additionally, it raises the visibility of their cause.”

This category of cyber risk represents a huge hazard in the context of nuclear power stations and worldwide supply chains. This kind of attack and attacker deals with more idealistic, siloed thinking, he said, which creates new sets of problems that cannot be met with a ransom payment.

An interesting combination of the types of threats is being exacerbated by the ongoing war in Ukraine. Up until this point, he said, the general populace in Russia has been able to almost shrug off the sanctions which have targeted the oligarchs first and foremost. However, as time goes by, there is increased financial motivation behind the government stepping up their cyber game.

“They’ve done a fair bit of damage in cyber,” he said. “In my opinion, they’ve been rather clumsy about it – their hacks haven’t had the sophistication that we see from other nation state actors, for instance… but they’re getting better, they’re sharpening up and they’re realising they can make up that lost ground. Along the way, they can trigger hacktivism with their mindset that any damage they do to the West is to their benefit.”

With so much cyber risk to balance simultaneously, it’s no wonder that companies are looking for any and every opportunity to mitigate their chance of being attacked but Cain highlighted that, unfortunately, you can’t afford just to focus on prevention. Everybody will be hit at some point in time, he said, and so the focus needs to also be on damage limitation.

The most frightening element of the shifting paradigm of cyber threats and cyber threat actors is now that wiperware concept, he said, as for every second in which that attack goes unnoticed or is not shut down, critical information and systems are being deleted or rendered unusable. With that in mind, Altus is changing the conversation around this threat by recommending segmentation and isolation of clients’ systems.

Traditionally, he noted that cyber security reviews acquire vast amounts of data about an organisation, regardless of whether it’s a small company, a big organisation or a government entity. Approaching every engagement in the same manner is the carpenter’s syndrome, he said, “where everything’s a nail because I’ve got a hammer”.

What Altus has recognised is that while cyber security needs those components, it also needs to know bespoke, mission-critical information such as where sensitive customer data is held, where financial data is kept, where third-party information is stored and where the control layer for all your IoT devices is located.

“We separate those out,” he said. “Part of what we’re looking at is that network segmentation so that when somebody gets in… a compromised account within the network only has a limited amount of information that they can see. [The hacker] can’t move from one segment to the other, because we’ve put that separation in place.”

“We’re [moving with the market] towards ‘zero trust architecture’ where if somebody’s in and trying to escalate to higher authority, they have to validate and revalidate over again to break out of the channel that they’re in. So, we’re containing and limiting the damage that’s being done because as long as they can’t get data out, then they’re restricted to the damage that can be done within that segment.”

Read more: Altus’ Aaron Cain on creating a culture of ownership around cyber risk

To get to a place where this approach is the new normal for cyber security will take significant collaboration, he said, and Altus is committed to fostering that collaboration.

“We’re willing to invest our time, our help and our experience into these environments to make everybody safer and systems much more defendable,” he said. “Because we know that then when somebody is not prepared for something, we can help with programme delivery or if you’re already there with a tabletop exercise or assessments to prove what you’ve done is effective.

“The key thing is that if the market is stronger and sounder, then we’re not seeing huge amounts of money lost to individual hackers and collectives. Everybody at Altus  knows that having these conversations educates the market – and an educated consumer is a better consumer.”

Find out more: Discover how Altus’ team can help you navigate today’s ever-shifting cyber landscape

With over four decades of experience in multiple market verticals, Aaron Cain has worked to integrate and secure business critical information flows across technology stacks ranging from legacy systems to cloud computing.

During years of independent consulting assignments based in the UK and EU, Aaron has developed the ability to frame complex technical and security concepts in concise and clear business terminology. Leveraging his experience with banking, hedge fund and insurance clients, Aaron will be working within Altus to develop specialised cyber security solutions and programmes for the financial services marketplace.

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Opening keynote speaker Mandy Hickson, a former RAF Fast-jet Pilot, started off Insurance Business UK’s 2022 ‘Women in Insurance Conference’ on a strong footing. Sharing her experiences flying multi-million-pound jets for the RAF and as the only woman pilot on her Front Line Tornado Squadron, Hickson emphasised the critical need to surround yourself with the right team in order to succeed and thrive, whatever your career path.

“As I’m talking,” she said, “I want you to reflect and think on who are your wingpeople? Those people that you know have got your back. Some of them may well be in the room with you today, but others might be colleagues – because it’s those relationships that are ones that make all the difference to us, leading us to high performance.”

Hickson’s keynote discussion set the tone for the day which was in itself a celebration of networking, effective leadership, and the creativity and diversity of experience that so many women bring to the insurance ecosystem. Panel discussions featuring some of the insurance profession’s most respected leaders – among them the likes of Lisa Bartlett, Sian Fisher, Jason Groves and Sheila Cameron – touched on a range of topics from ‘Personal brand and your leadership’ to ‘Lessons learned from a multigenerational workforce’.

This being the first WII Conference I have had the pleasure of attending in-person since joining Insurance Business, I was struck by the enthusiasm of the speakers and the audience alike, and the willingness of everybody assembled to engage with the full raft of topics on discussion. Throughout the day and into the late afternoon, it was remarkable to see just how much there was left to say – not to mention to do – when it comes to diversity, equity and inclusion in insurance.

Read more: LMA CEO Sheila Cameron on the two secrets to a successful business

The power of passion was a key takeaway from the conference. To hear such talented, enthusiastic and compelling women and men discussing their experiences within the insurance sector was something of a revelation. There are so many conversations about the power of passion but it’s only when you get an opportunity to see these playing out in real-time that you can truly appreciate the deep and abiding connections that underpin so many insurance relationships.

Whether discussing the paradox of flexibility and exposure in this new working environment or how to make a positive, lasting impression in the workplace – passion stood out as the key ingredient among each of the speakers. And to see it in action really was to see the insurance profession at its finest.

Another takeaway for me was realising the sheer variety of voices that can be heard across the insurance market – when they’re given a platform to speak. The wealth of insight generated from the diversity of backgrounds, routes into the market and differing experiences of a career in insurance is extraordinary to see.

Read more: How to have the difficult conversations around diversity and inclusion

And far from limiting themselves to the broad-strokes questions around gender, age and race – these voices touched on topics including everything from neurodiversity, engaging with introverted talent and developing emotional intelligence.

Of course, hearing these insights also begs the question of who else are we not yet hearing? Who else doesn’t have a seat at the table but would be able to further educate and inform us about topics beyond our realm of experience if they did? The conference was, in essence, an invitation to think bigger and broader about DE&I and to engage with it not as a destination to reach but as a road to keep travelling.

Did you attend the Women in Insurance 2022 Conference? Please feel free to share your comments or insights below.

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FloodFlash has again beaten its own catastrophic property flood claim payment record – from five hours and 36 minutes in February to less than four hours after flooding this time around.

“On November 22, 2022, at 9:40am, the sensor at a property management client based in Stamford detected that their chosen trigger depth of 1m had been met,” reported the parametric insurance provider. “By 1:30pm, FloodFlash had paid the client in full.”

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As part of the restructuring, David Sawyer, who joined Markel International in 2015, will take on an expanded role with responsibility for the combined divisions as divisional managing director of PFR and cyber. Meanwhile, Chris Burgess will continue to lead the London-based cyber team, and will now report into Sawyer, with a role focused on developing growth potential for the business line.

Markel’s commitment to the evolution of its cyber team has been clear in recent years from its variety of senior appointments including that of Ed Rawe, who joined Markel in 2021, and has been promoted to senior cyber underwriter.

In addition, Lewis Bennett has joined as senior cyber underwriter from Allianz Global Corporate & Specialty (AGCS) while Dan Fox has joined as senior underwriter from Aspen Insurance Group and Ollie Carroll has joined the team as assistant underwriter.

Commenting on the move, Andrew McMellin, managing director of wholesale at Markel International, said: “When Markel started writing cyber business almost ten years ago, clients were facing a very different, and significantly less complex risk landscape than the one they face today.

“Cyber risks have gained prominence and are now intertwined with other business lines, especially those that sit under our PFR division. When we were looking at how we can keep our business relevant and tailored for our clients, we saw many benefits in the merging of the two divisions.” 

He added that this means that Markel International’s cyber underwriters can now align themselves more closely with its PFR teams. This, he said, will allow them to plan and innovate collaboratively, and bring about a more holistic approach to its cyber offering – to the benefit of both its broking partners and end clients.

Discussing the growing cyber team, Sawyer commented: “We have highly skilled and well-respected cyber underwriters and I look forward to working with Chris and the rest of the team, as we continue to expand our combined offering for our brokers and clients.”

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In this part of our client education series, we will explain the meaning behind common industry buzzwords to help consumers gain a proper understanding of how different insurance policies work, so they can find the coverage that best suits their needs. We encourage agents and brokers to share this article with their clients to help them navigate these complexities.

If you are looking for a specific term, push control + F (or Command + F on Mac) and then type in the word to find the definition right away.

The insurance terms below are divided into five categories:

1. General terms – for buzzwords that apply to all insurance policies
2. Auto insurance terms – for terms that apply exclusively to car insurance
3. Health insurance terms – for accident and health insurance industry buzzwords
4. Home insurance terms – for terms often used in property insurance such as homeowners’, landlord, and renters’ policies
5. Life insurance terms – for jargon commonly found in life insurance policies

The definitions below were based on the glossaries of industry bodies National Association of Insurance Commissioners (NAIC), Insurance Information Institute (Triple-I), and International Risk Management Institute (IRMI), and several insurance industry specialists—including myself!

All-risk

All-risk coverage, also referred to as open perils, insures against all types of losses, except for those that are specifically excluded from the policy. This applies to several property and casualty (P&C) categories, including homeowners, auto, and commercial insurance.

Cancellation

This refers to the cancellation of an insurance policy before the specified end-date. Typically, policyholders get a refund for any unused premiums, although insurers may charge a cancellation fee.

Claim/Claimant

An insurance claim is a formal request filed by the policyholder to their insurer for compensation for covered losses or damages. These can include vehicular accidents for auto insurance, storm damage for homeowners’ policies, and emergency surgeries for health insurance plans.

A claimant, meanwhile, is the person who files the claim. In most cases, this is the policyholder.

Conditions (Policy conditions)

This is the section of a policy document that explains the duties and responsibilities of the insured (policyholder) and the insurance company. It also states the requirements that need to be met for the coverage to be valid.

Commencement date

This is the date when the insurance policy goes into force. It is also known as the effective date.

Declarations page

This section of the policy document, also called the dec page, summarizes the details of the policy. It contains the coverages, limits, deductibles, and effective date. This page is often located on the front page of the policy.

Deductible

A deductible is the amount the policyholder agrees to pay out-of-pocket before the insurance company shoulders the cost. Typically, the higher the deductible, the lower the premiums as the insurers bear less financial risk.

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There is no getting around paying insurance deductibles. Even the largest insurance companies in the world have these policies, and their main goal is to make it so insurance companies don’t get flooded with small claims.

Hazard

A hazard is a situation or condition that raises the likelihood that a loss will occur. Ice on sidewalks, for example, increases the chance of a person slipping and getting injured, while smoking raises the probability of a policyholder getting lung cancer.

This is different from a peril, which is something that causes a loss. This includes fire, theft, collisions, natural disasters, illnesses, and death.

Lapse

This refers to a period when one goes without insurance coverage. If a person, for example, fails to renew their auto insurance policy, then they now have a lapse in coverage.

Loss

A loss is the basis for filing an insurance claim. This includes direct and accidental damage the insured or their property sustains.

Named insured

The named insured is the person or business named in the policy, also referred to as the policyholder. An insurance policy can have more than one named insured. The named insureds are listed on the declarations page of the policy document.

Named perils

These are the specific type of losses or damages listed in the policy document. A named perils coverage provides protection against these.

Policy

An insurance policy is a written contract between the policyholder and the insurer that lays out the details of the coverage. This includes coverage, exclusions, deductibles, and premiums.

Premium

This is the amount charged by an insurance company in return for coverage. There are several factors that impact premiums. These include age, gender, and driving history for auto insurance, weather-related and crime risks in an area for homeowners’ policies, and medical history and smoking status for life insurance.

Rider

A rider, sometimes referred to as an endorsement, is an optional coverage that policyholders can add to their policies. This includes identity theft and water backup coverage for home insurance, and accident forgiveness and roadside assistance for auto policies.

Agreed value

This type of policy pays out for the value agreed upon by the policyholder and insurance company when the policy was purchased in the event the vehicle is wrecked beyond repair. This is as opposed to stated value coverage, which reimburses whichever is lower between the stated value or actual cash value at the time of the loss.

Bodily injury coverage

Also known as bodily injury liability, this pays for the medical expenses a third party incurs due to an accident cause by the policyholder. This policy also covers legal costs in the event the insured is sued for damages.

Collision coverage

This part of an auto insurance policy covers the cost of damages resulting from a collision with another vehicle or object, or the car flipping over.

Comprehensive coverage

This is the portion of a car insurance policy that pays out damages not caused by a collision such as fire, vandalism, and natural disasters. It also covers incidents of vehicle theft.

Medical payments coverage (auto)

Also called Med Pay, this is an optional coverage that helps pay for medical expenses that the policyholder and their passengers incur due to a car accident, even if the driver was at-fault.

Motor vehicle report (MVR)

The MVR details a person’s driving history, including accidents and traffic violations, as reported to a state’s motor department.

Personal injury protection (PIP)

PIP is a part of an auto insurance policy that provides coverage for medical and other expenses resulting from a vehicular accident, regardless of who is at-fault. It covers the policyholder, the car’s passengers, and anyone driving the vehicle for injuries sustained from a collision, even those who do not carry insurance.

Telematics insurance

Also called usage-based insurance or UBI, this works by adopting onboard technology or mobile applications to monitor a policyholder’s driving habits. Telematics then uses the information gathered to reward safe drivers in the form of discounted premiums or, in some instances, penalize risky motorists in the form of surcharges.

Uninsured motorist coverage

Uninsured motorist coverage, also referred to as UM, is designed to provide compensation to policyholders when an at-fault driver does not have liability insurance or illegally leaves the scene of the crash.

Underinsured motorist coverage

Underinsured motorist coverage, or UIM, works almost exactly the same as UM. The only difference is that UIM provides protection when the at-fault driver carries insurance, but their coverage is not enough the pay for all expenses.

Would you like a little bit of help with getting your premiums down? Read our list of the 10 cheapest cars for you to insure in the UK.

Ambulatory services

These are health services provided to policyholders who are not confined to a healthcare institution. Ambulatory services are also referred to as outpatient services.

Assisted living care coverage

This type of coverage pays out if the policyholder is confined to an assisted living facility. Some health insurers offer this type of policy as a rider.

Benefits

These refer to the total expenditures paid out by an insurer for health care services accessed by the policyholder, including medical and hospital bills.

Calendar year deductible

This is the amount that the policyholder must pay during a calendar year before the health insurance company covers the costs.

Coinsurance

Coinsurance is the portion of coverage that the policyholder must pay for covered services after the deductible has been paid. Coinsurance rates are often indicated as a percentage. For example, if the insurer pays 80% of the claim, the policyholder will shoulder the remaining 20%.

Copayment

This is usually a flat fee that the policyholder pays for certain medical services, with the rest covered by the insurance provider.

Group health coverage

This is an organization- or employer-sponsored plan that covers members or employees, as well as their dependents, under a single policy.

Long-term care coverage

Long-term care insurance, also called LTCI, pays out the cost of medical and non-medical services provided for senior-aged individuals who have lost the ability to care for themselves. It covers individuals cared for at home, nursing homes, assisted living facilities, or adult day care centers.

Out-of-network provider

This refers to health services providers who are not part of a health plan’s network. Policyholders have the option to access out-of-network providers, but they generally pay more for their services.

Out-of-pocket maximum

This is the highest amount the policyholder pays during a year for coverage. This includes coinsurance, copayments, and deductibles, but is on top of the regular premiums. Once the out-of-pocket maximum has been reached, the health insurer will cover all expenses for the rest of the year.

Want to learn more? Read our list of the 10 largest health insurance providers in the US.

Actual cash value coverage

This pays for the value of the property at the time of the loss, factoring in depreciation. This is as opposed to replacement cost coverage, which is explained below.

Additional living expenses coverage

This covers the cost incurred if the home becomes uninhabitable due to a covered loss. Coverage is standard in most homeowners’, condo, and renters’ insurance policies, and includes meals and hotel stays. This type of policy is also referred to as loss of use coverage.

Appraisal

Appraisals are often conducted to get an accurate estimate of the cost to rebuild a home, settle claim valuation disputes, and provide sufficient coverage for personal belongings.

Market value

This value refers to how much a property will sell in the market.

Medical payments coverage (property)

This type of policy covers the medical expenses of guests who are accidentally injured within a property’s premises, regardless of who is at-fault. Coverage does not include the members of the owner’s household.

Other structure

This refers to structures within the property’s premises that are not directly attached to the house such as a garage, fence, or shed. Depending on the policy, these may be covered under homeowners’ insurance.

Personal injury coverage

This type of policy covers instances other than bodily injury and property damage. These incidents include false arrest, invasion of privacy, libel, slander, and wrongful eviction.

Replacement cost coverage

This covers the cost to repair or replace damaged property without factoring in depreciation. This type of coverage applies to the house, also called dwelling, and personal belongings.

Scheduled personal property coverage

This type of rider allows the homeowner to raise the amount of their policy limits to cover for high-value items such as jewelry, artwork, musical instruments, and other collectibles.

Water backup coverage

This optional coverage pays out for damages caused by backed-up drains, clogged sewer lines, and failed sump pumps, as well as mold buildup resulting from these events.

Beneficiary

A beneficiary is the person or entity that the policyholder designates to receive the death benefit. This can be the insured’s spouse, immediate family, other relatives, friends, business partners, or even a charitable organization. Policyholders can name several beneficiaries for their life insurance plans and assign how much benefit each person or group will receive.

Convertible term life insurance

This type of policy can be converted into permanent insurance without the need for medical assessment. The insurance company is required to renew the policy regardless of the insured’s health status, subject to policy conditions.

Death benefit

This refers to the amount that the insurer pays the beneficiary after the policyholder’s death.

Endowment policy

This type of coverage pays out the benefit either at the end of the contract period or upon the policyholder’s death. This is as opposed to standard life insurance policies, which pay the benefit only after the insured’s death.

Living benefits coverage

This rider provides long-term care coverage for the policyholder if they become terminally ill.

Permanent life insurance

Permanent policies provide guaranteed lifetime coverage and a cash value element that builds up over time that can be used as collateral if the policyholder decides to borrow.

Surrender value

This refers to the amount the policyholder will receive from the insurer if they decide to exit the policy before it matures. The value is often significantly lower than the actual benefit.

Term life insurance

This type of policy pays out a death benefit if the insured dies within a specified period. This means the insured can only access the payment in the years when the plan is active.

Universal life insurance

Universal life insurance is a type of permanent policy that uses different premium structures to build up savings, with the earnings based on how the market performs.

Whole life insurance

Whole life insurance is a type of permanent policy where the savings can grow at a guaranteed rate.

If you’re looking for some options here, read about the USA’s 15 largest life insurance companies.

Considering that insurance is designed to protect a person’s assets and loved ones, purchasing a policy requires careful planning and research. Having a firm understanding of these insurance buzzwords allows customers to find a policy that best fits their needs. With everyone speaking the same language, consumers can find the right coverage minus the frustration and disappointment.

Are there any more insurance terms that you want us to cover? Share them below and we will add them in an update.

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“The broad idea is that there should be a cap on what any individual needs to pay personally for care, and a cap set at £86,000 was due to be implemented in 2023,” said Hamilton.

“It relates to anyone who needs long term care, whether because of dementia or some other cause, although of course dementia will be a major factor for a large and growing number.”

More than 70% of care home residents and 60% of people who receive at-home care are living with dementia, according to figures provided by the IUAD.

Read more: IUAD on the ‘wonderful opportunity’ facing the insurance sector

Anything that “provides a degree more uncertainty” as to state provisions where it comes to longer term care is welcome, according to Hamilton, despite the delay.

Past criticisms of the cap have included whether it was fair from an intergenerational perspective, how funds would be raised, and whether measures could fall disproportionately on younger people.

“These remain legitimate challenges,” Hamilton said.

“There is more funding coming into the system, but initially it has gone to the NHS to help with the COVID backlogs – there are also challenges as to where any new money goes.”

Other concerns include that the cap could “defy easy explanation or calculation”, Hamilton said.

In its anticipated guise, the cap would not cover food or accommodation costs, but rather specific care costs. It is also expected to be based on local authority assessments of need, rather than necessarily what an individual has already paid.

“Where the ‘meter’ for the cap starts and stops will be critical,” Hamilton said.

In a recent interview with Sky News prior to the Autumn statement, former Prime Minister David Cameron called for Chancellor Jeremy Hunt to “look again at the issue of is there some way of providing some sort of backstop insurance so that you don’t have to sell your home to pay for care?”

The proposals as they stand, though, “won’t be able to guarantee that no-one need ever sell their home to meet the costs of care, even if that were seen as the right policy ambition,” Hamilton said.

With many individuals still expected to make a “substantial contribution” to their costs, one question for Hamilton is whether the insurance industry can help.

The current market for care-related propositions is limited, and largely made up of ‘immediate needs’ annuities (around 3,000 of these were sold last year, according to Hamilton), equity release and some “care riders” on whole-life plans.

A lack of advisers specialising in care is likely one reason for relatively low take up on immediate needs, according to Hamilton, while the equity release market is “likely to grow”.

“Key barriers to date have included lack of consumer demand and lack of clarity as to what the state will provide, with many believing care is essentially free, like broader NHS services,” said Hamilton.

“The majority of people do not make plans to pay for care, people routinely underestimate the cost of care and people are not incentivised to make plans to meet costs.”

One way for people to meet costs is to save, but Hamilton said it is “hard to conceive” that new savings vehicles are needed, though more tailoring of existing pensions and ISAs could take place.

“The 2015 pension reforms allow customers to use their pension pots far more flexibly than in the past, which can include supporting with care costs,” said Hamilton.

“There have been periodic suggestions that payments from a pension to a care provider should be tax-free, or payments to an insurance product should receive tax relief.”

A challenge here is any pervading “belief that the state would provide free care”, according to Hamilton.

“It could [be] that people start to believe that ‘social care’ has been fixed,” he said.

“More optimistically, I hope that we will see an emerging recognition by many that they will be expected to contribute a substantial amount towards their costs, and that they start to consider what this means – the deferral of the cap this week will reinforce this.”

There may not be a “silver bullet” insurance product that can cover everyone’s care costs, but Hamilton said that in time the industry may develop a wider suite of products for this “large and growing” market, particularly as it is not just people who require care themselves who may be financially disadvantaged, but also their younger family members.

Questions for them include how they might meet costs, including accommodation and food, given they still may have to spend more than £86,000 once the cap is introduced.

With one in four people expected to need some kind of care, setting premiums for any insurance solution “won’t be easy” but could be more viable for younger purchasers. Defining the “right” sum assured would though bring its own challenges, Hamilton said.

There will not be “one answer” for everyone, according to Hamilton, with individual needs varying, particularly where it comes to people at different life stages.

Questions for the insurance industry, Hamilton said, include: “How can [individuals] be helped to stay safely in their own home for longer (many will be even less likely to see a care home as a desirable option after seeing the impacts of COVID)? Could we create services linked to technology sensors, that provide alerts to potential dangers, [or] changes in behavioural patterns?

“How can we help empower more people to enjoy active, healthy, technology-assisted later years through chronic illness prevention and management, improved disability management, and mobility assistance? Can we influence the shape and nature of care homes of the future?”

Read more: What makes IUAD such a worthy cause?

Hamilton came on board at the IUAD earlier this year, along with Lloyds Banking Group protection director Rose St Louis, as the organisation sought increased engagement on the life and protection side.

It has this year called on people to sign an Alzheimers Society petition for the government to make dementia care and research an urgent priority.

“While the political environment has been turbulent, the policy calls remain clear and consistent,” said Hamilton.

The IUAD has so far raised more than £7 million of its £10 million target, with events this year having included a Sahara Trek, a 5k run, partner presentations and sign ups and dementia friend training days. 

“The activity hasn’t stopped – the Insurance Day of Giving is an opportunity for the industry to unite on Thursday, December 1, to fundraise and raise awareness of dementia,” Hamilton said.

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McLarens Aviation is a leading provider of loss adjusting, survey and risk services to the global aviation industry, he said, and it hosts a team of over 90 in-house aviation specialists, operating out of a network of offices in 21 countries across the globe. With such a broad reach, it’s little wonder that Oliver has a clear viewpoint of the key pain points pressing on the industry and on what the firm must do to keep pace with the ever-changing needs of its global client base.

“Prior to the COVID pandemic, our big focus was on international expansion, particularly in the areas where passenger demand was increasing in line with economic growth,” he said. “So, for example, we’ve invested heavily in our US presence – particularly in the general aviation market – alongside opening new offices in the likes of Frankfurt, Brisbane, Beijing, Shanghai, Brasilia and Vancouver.

“As we recover from the pandemic, the focus has been on supporting the industry’s return to normality, however, there are some notable areas where we have seen renewed interest. Commercial drone usage has taken off in recent years and shows no sign of abating. We’ve seen a marked increase in UAV claims across our global network, as a result.”

Looking across the market, he noted that there’s growing interest in the development of electric-powered aircraft. There has been significant investment and some notable technological advances, including the maiden flights of some prototype all-electric light aircraft over the past year.

The team at McLarens Aviation has also seen an increase in the number of ground handling incidents between equipment and aircraft, he said. The key challenge here is that airport traffic is increasing rapidly as airports move to return to normal services, leading to increased pressures on turnaround times, aircraft parking, etc. More broadly, the firm is currently hiring across its European network and has recently been appointed to a major airline client in the Middle East.

Claims costs are a challenge impinging on many areas of the insurance ecosystem and the aviation section is no exception. Oliver highlighted that even before the inflationary pressures that are now being seen globally, claims costs were increasing within the aviation sector. Several factors are contributing to making the ad-hoc post-incident repair of some aircraft and engines notably more expensive, he said, including the adoption of new composite materials in aircraft, the control of the spares market by manufacturers and the impact of long-term Power By the Hour (PBH) maintenance contracts.

“We have reviewed our own data relating to typical, day-to-day claims (those under $10 million dealt with on a weekly basis across the globe) and found that claims relating to composite aircraft with significant repair needs are more expensive to deal with than traditional metallic structures,” he said. “This is partly to do with materials. For example, a single-engine fan blade on a large jet engine that might have cost $30k twenty years ago could easily cost $150k today depending on the material and design.

“It’s also to do with maintenance and repair processes. For example, it is not uncommon to receive quotes on a fixed price basis and while this gives some certainty for repair budget planning, the experience of many adjusters will show that these fixed costs contain an element for contingencies. We are continuously engaging with manufacturers and repairers on these points, on our clients’ behalf.”

McLarens has also recruited a number of engineers with specific knowledge of composite aircraft having worked within both manufacturers and operators, he said, and will undertake an internal training programme on these developments.

Read more: WTW introduces Airport Risk Index

Another key trend that Oliver and his team are seeing is the impact of external weather as a cause of insured losses in the aviation sector. Lightening, wind, hail and thunderstorms all pose hazards to aircraft, as does flooding. In many regions, he said, weather events appear to be becoming more extreme and prevalent.

The sudden and unexpected nature of some storms can prevent manufacturers and owners from taking the necessary steps to protect aircraft in time to avoid damage. He noted that while hurricanes can be tracked and planned for in advance, sudden and unexpected storms can turn out to be much more severe than expected or originally reported.

“Microbursts, tornados, and earthquakes are other – albeit less frequent – weather events that have previously been the source of claims having caused severe damage to aircraft,” he said. “Claims, of course, vary in size and scale of damage, from dents caused by hail, to total loss of aircraft.

“In 2011’s Thai floods, for example, damage to runways and aircraft was a major driver of claims. Flood water at airports causes major contamination as well as damage to aircraft parked at the airport that were unable to be flown out. The flood water also causes significant damage to ground equipment and airport vehicles, in addition to affecting stores full of aircraft parts and test equipment that have been immersed in flood water.”

During the COVID-19 pandemic, he said, there was the added challenge that many commercial aircraft were, at least for a period, grounded. The combination of mass accumulations of parked aircraft in single locations and more extreme weather events hugely increased underwriters’ exposure to this risk.

Digging into the upheaval of the pandemic and how well the aviation sector has recovered in the post-COVID period, Oliver noted the sheer variety of major challenges that faced the sector – from staffing and training, to transitioning an unprecedented number of aircraft from storage facilities to the runway.

“There were some major challenges facing the sector and the industry had done a good job at addressing these,” he said. “That’s not to say that some challenges don’t remain. The staffing shortages impacting some operators have been well documented and airlines and airports are working hard to address those.

“Despite some operational challenges, pent-up travel demand post-pandemic remains strong. In the short term, things look positive for the sector, though notwithstanding the wider economic challenges that all industries are facing.”  

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When discussing the shift in paradigm of cyber risk in modern businesses, in a recent feature with Insurance Business UK, Aaron Cain, cyber security consultant at Altus highlighted the challenge represented by employees who still think that cyber risk “has nothing to do with them”. It’s a misconception that is damaging to the very fabric of business continuity, which is why creating a culture of ownership around cyber risk is fundamental to good cyber hygiene.

Find out more: Discover how Altus’ team can help you navigate today’s ever-shifting cyber landscape

Digging into the ‘how’ of how this ownership piece can be constructed, Cain noted that it all starts with empowering employees to not just recognise cyber threats but also feel confident when reporting them. Consider the simple but effective messaging of the London Underground, he said, that of ‘see it, say it, sorted’. It’s the same for cyber risk, when somebody sees something suspicious, that information needs to get to the right people as quickly as possible.

“Organisations need to empower their workforce,” he said. “This is the really essential piece, moving away from that [attitude of] ‘my company’s cyber security teams should deal with it… I’m just going to move around something when it doesn’t look right because it doesn’t impact my task’. When somebody makes a blunder or, more to the point, tries to be helpful only to find they’ve done something wrong, the immediate human reaction is to say ‘oh, it wasn’t me, I was over there getting coffee at the time.’”

Read more: A shifting paradigm – how digital transformation is creating new cyber risk exposures

People don’t want to admit when they’ve made a mistake because they believe that blame comes along with that, he said, and that notion has got to change. If organisations don’t focus on eliminating that blame culture and don’t work towards getting to a place where people feel emboldened to admit their mistakes because they know they will be backed to the hilt, then employees will continue to try and bury their mishaps.

“They’ll hide it until it’s too late and you’ll only find out about it when somebody’s going back and doing the recovery,” he said. “[…] I’ve probably run across half a dozen, maybe a dozen companies over the course of my career who are very supportive and say that if you see a problem, just let us know you made a mistake and it’s not going to affect your career or anything else. This brings people into that accountability loop that makes people want to [be honest] because they know it’s going to be good for the company.”

That empowerment piece is part of the solution, Cain said, but a second part is making cyber risk understandable to employees across an entire business. Too often, the cyber security services engaged by a firm are simply not fit-for-purpose because they are generic, pre-packaged solutions that are not applicable to real-life scenarios or a modern hybrid work environment.

Read more: Staggering 90% of cyber risk uninsured

Taking phishing identification training, for example, he noted that click rates are still in the 40-50% range for most firms. When people get it wrong, the test comes back and they do it again, and they keep doing it until they tick the right boxes and get the right results – but without actually engaging with the education content at hand.

“A lot of it has to do with the attitude from the top going down,” he said. “Are you in business just to be in business? Or do you really understand that you need everybody to be secure so that you don’t run the risk of the impact and reputational damage of a cyber incident? Unfortunately, in many cases, people are too busy being ‘in business’ with an attitude of ‘oh, this is an hour lost to what we should be doing’. And that has to change from the top-down.”

The third piece that the Altus team has identified as crucial to creating ownership around cyber risk is around finding a way to make cyber security conversations universal. Just talking to your IT security people doesn’t help, Cain said, and just talking to your board doesn’t help. This message needs to go further and it needs to translate all the way down to the average employee working at the coalface of cyber risk exposures.

“They need to understand – here is what we’re looking for, here’s what we’re expecting, here’s what’s happening in the industry around us,” he said. “Threat intelligence is all around us with people talking about the most recent thing to pop up, so have your people take a look.”

“All it’s got to be is that first couple of times, somebody comes up and says ‘by the way, I saw this’. That’s great because it shows this is applicable to what they’re doing… It’s much more powerful when it comes from somebody who’s actually in the seat, who happens to see this on a scan and knows to ask whether to be concerned about it.”

Cain and his team actively work with organisations to empower their people to understand, notice and report cyber exposures – and he highlighted that at the core of Altus’ delivery model is a focus on collaborative discussions and genuine partnerships. Because too often, cyber security consultants come in and ‘talk at’ a company, focusing on just the IT team or the board, without taking into account the shared nature of cyber risk.

Mentorship is the key to doing this differently, Cain said. He emphasised the power of a ‘three-by-three’ approach to mentorship, where you always have three people that you lean on for insight and guidance, and three people that you’re providing that support to – as this allows the development of a holistic overview of cyber risk and a continuous flow of insight and information.

“Pushing out into a diverse pool gets the perspective of people other than me,” he said. “And when I go to a customer site, I do the same thing. Yes, I talk to the people that need to implement and operate the controls and the board who need to understand what’s going on. But I also then go and talk to the people who are using these controls and say, ‘we’re doing this, do you understand why?’”

People like to know the reasons behind decision-making and to understand how it impacts them, which is why it’s so critical to bring together that mentor-mentee relationship so that everybody across an organisation is in the loop and able to pass relevant information on. When you put those two things together, he said, you come out of a scenario with a stronger cyber culture, a stronger employee base and a stronger corporate structure.

Having supported organisations with these processes for several decades now, Cain has seen how engagement with cyber security resources has shifted. It’s been a continuous evolution, he said, but the dial is moving towards the point where companies recognise that they do what they do best, but they need support in managing their cyber risk exposures in order to be able to continue operating without interruption.

“Part of what I like from Altus’ perspective is that we are working collaboratively not just with our clients but also outside resources,” he said. “We’re working and partnering together [with third parties such as industry experts and the cyber resilience centres] to support companies that might not have the money to sit down and implement a full-blown programme. Because we recognise that the market is better if they’re doing something.”

Altus has created an initiative called ‘Cyber Conversations’ where the team will go out and talk to companies about what’s happening in the cyber security environment and what they need to be doing to protect themselves. This includes providing bespoke templates that suit their operational environment. It’s a genuine collaboration that benefits both parties, he said, and the most telling thing is that it seems to be already working within the wider market.

Recent research has revealed that the percentage of small businesses hit by cyber attacks in the UK is significantly lower than their US counterparts, he said. This is likely because small businesses in the UK are starting to collaborate, sharing tips on best practice and working together to eliminate their exposures as recommended by industry experts and regulators. This has pushed hackers towards multi-national companies and national infrastructure where the reward for a successful breach is higher.

“People are starting to realise that we have conferences, and seminars and online thought leadership articles, and great information coming from the industry that helps them understand what they need to do a bit better,” he said. “I have been pushing this collaboration piece from basically day one with all the things I’ve been doing.

“This was first a goal, then it had deliverables and now it’s down to getting the right frameworks in place so we can all talk together and make sure that we’re bringing the right resources in. No one of us has everything the customer is going to need. All of us together can make sure that the customer has the right things in place at the right time and is getting value for money. And that’s what we’re really focusing on.”

Find out more: Discover how Altus’ team can help you navigate today’s ever-shifting cyber landscape

With over four decades of experience in multiple market verticals, Aaron Cain has worked to integrate and secure business critical information flows across technology stacks ranging from legacy systems to cloud computing.

During years of independent consulting assignments based in the UK and EU, Aaron has developed the ability to frame complex technical and security concepts in concise and clear business terminology. Leveraging his experience with banking, hedge fund and insurance clients, Aaron will be working within Altus to develop specialised cyber security solutions and programmes for the financial services marketplace.

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“In our view, the global economy will cool down noticeably under the weight of inflation and interest rate shocks,” said Jérôme Haegeli, Swiss Re group chief economist. “The repricing of risk in the real economy and financial markets is actually healthy and a long-term positive. Higher risk-free rates should mean higher returns for investing into the real economy. During today’s challenging times – and for the economic recovery period ahead – the insurance industry can show its value as it provides financial resilience at all levels of the community.”

Major economies, especially in Europe, are likely to face inflationary recessions in the next 12 to 18 months amid higher interest rates, Swiss Re Institute said. Global GDP growth is projected to slow to 1.7% in 2023, down from 2.8% this year.

Swiss Re Institute predicted 5.4% average annual global CPI inflation in 2023 and 3.5% in 2024, down from 8.1% in 2022. Despite a predicted easing of momentum, inflation is predicted to remain volatile and persistently above historical averages. Inflation is challenging to insurers because it erodes nominal premium growth, impacts global demand and creates higher claims costs in non-life lines, Swiss Re Institute said.

The report predicted that non-life real premium growth would recover to 1.8% in 2023 and 2.8% in 2024 after weak 0.9% growth in real terms this year. In Europe, the predicted improvement reflects strengthening economic conditions as the region recovers from the coming downturn. Potential insurance rate increases and easing inflation in the US and more favourable real growth in Asia are expected to support stronger premium growth in those regions, the report said. China, which accounts for 60% of emerging market non-life premiums, is projected to see 4% real non-life premium growth in 2023 and 5.8% in 2024. 

Commercial lines are projected to benefit most from rate hardening and expand more than personal lines (excluding health), the report said. Swiss Re estimates a 3.3% growth in commercial premiums this year and a 3.7% increase in 2023. In contrast, global personal lines premiums are predicted to shrink by 0.7% in 2022 – driven primarily by underperformance in motor insurance in advanced markets – then recover to 1.8% growth next year.

The cost-of-living crisis in advanced markets is estimated to have driven a contraction in global life insurance premiums of 1.9% in real terms in 2022, Swiss Re Institute said. The report predicted this contraction would be followed by real premium growth in 2023 and 2024 of 1.7%, primarily due to 4.3% growth in emerging markets, including China.

The report found divergence in life premium growth drivers in advanced and emerging markets. Inflation in advanced markets, especially Europe, is tightening household budgets and reducing consumer demand for individual savings products. In emerging markets, by contrast, the growing middle class and government targets for life insurance penetration are driving growth in savings business. Demand is also being supported by younger, more digitally savvy emerging markets consumers who are more aware of the benefits of long-term life policies, the report said.

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