The FCA, for its part, pointed to recent efforts to cut back on bureaucracy and increase efficiency. A spokesperson noted the regulator has reduced data reporting requirements, removed outdated supervisory materials, created a private market framework for securities, simplified insurance regulations, and is advancing reforms aimed at clarifying redress processes for firms and consumers.
“We’re seeing much more detailed inquiries,” Porter said. “What’s the specific risk in this region, at this site? Customers, brokers, and other partners are involving us earlier in the decision process. That’s a shift from even five to 10 years ago, when insurers often only found out after the expansion. Now we’re part of the planning, and that’s a great change.”
“While our financial results are far from Starbucks’ potential, we are working to build back a better business,” said Cathy Smith, chief financial officer, in a previous statement. “We are developing new muscles to test, iterate and scale quickly, in service of long-term, durable growth and strong returns on invested capital.”
“Applied Systems invests heavily in innovation and market expansion where we believe we can create new value for independent insurance agencies and brokerages,” said Taylor Rhodes, chief executive officer of Applied Systems. “Our decision to bring Applied Epic into the UK market was based on our belief that the UK broking community desired new BMS alternatives, but we struggled to deliver a fully featured product in the face of competitors with incredibly strong positions in the market. As in any business, you take calculated risks, and some of them play out and return significant value and others do not. While this investment did not work out, recognising this fact now presents us with the opportunity to reallocate capital toward other investments that are supporting our winning position in our other markets.”
In the latest edition of Insurance Business TV, Adam Atkins, of Hiscox, explains how the company is reshaping its technology insurance coverage. He looks at customer feedback and explicit AI coverage, as well as how client confidence has been boosted.
At the same time, brokers must work with carriers to ensure the products fit the needs and budgets of SMEs. For Lezzi, the future of the cyber insurance sector hinges on a blend of forward-looking risk management, adaptable product design, and global education, especially for underserved market segments.
Treloar pointed to cyber and directors and officers (D&O) insurance as two key areas where clients are often exposed, despite clear risk signals. “There are still many customers that should purchase [cyber cover] that don’t,” he said. “Equally, I think the same is true for D&O.” S&P Global Ratings noted in a recent webinar that “only 5% to 10% of small and medium-sized enterprises currently hold cyber insurance.” For D&O, a Global Information report found that “39.9% of SMEs now have D&O (excluding sole traders), a figure that rises along with company size.” Treloar added: “We want to find solutions for these exposures for all of our customers as well, and to support them as the world continues to evolve.”
The acquisitions, finalised within a five-month period, respond to increasing client demand for support in navigating regulatory compliance, sustainability requirements, and cyber risk. Each acquisition brings in targeted expertise to address shifting expectations from regulators, stakeholders, and supply chain partners.
Kelly Ostler-Coyle, head of communications and stakeholder relations at Flood Re (a UK government-backed flood insurance scheme) highlighted the challenge of flood claims. “When Flood Re started, if you’d had a previous flood claim, it was really hard to get insurance… the premium, and the excess would be so high that it would be almost like self-insuring,” she said.
Addressing flood risk now requires a focus on long-term resilience. Ostler-Coyle stressed: “We need a housing stock that’s going to be there in many years’ time, that isn’t going to have to be continually rebuilt because of flooding.” She warned of the ripple effect of development on flood risk: “The more you build over, the less there is for the rain to absorb, so we need to be building with flood risk in mind… even if you protect one new area, it could run down the hill and affect a village that’s never been flooded before.”
Old IT frameworks are making insurers less competitive, slowing down product launches and innovation, from customer experience to operational efficiency.
Meanwhile, the insurance sector is investing 70% of its IT budget to sustain these outdated systems.
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