Innovation within insurance market becoming more crucial source of competitive advantage as clients seek new solutions for emerging risks

Chaucer, the global specialty (re)insurance group, says innovation within the (re)insurance market is becoming a more crucial source of competitive advantage as clients seek new solutions for emerging risks.

Chaucer’s Building for the future: innovation as a strategic tool in (re)insurance White Paper explains that as the (re)insurance industry becomes more competitive, innovation is becoming increasingly crucial to differentiate firms. As well as helping to boost their reputation, durability and growth, innovation can help insurers support clients seeking more sophisticated (re)insurance products which are better equipped to respond to the new risk landscape.

“Clients no longer view innovation from their insurer as merely a bonus but as a necessity.”
“As clients battle with new and changing risks, one of the major levers in the insurance industry’s strategic toolkit is innovation - setting up thoughtful, contained experiments to solve for key client challenges. No one knows what the future holds, hence the power of innovation, of experimentation.”
Dr Hayley Maynard
Head of Innovation at Chaucer

The paper outlines that even though there are multiple ways of approaching innovation within (re)insurance firms, a key unifying factor in driving success is clarity of purpose.

Chaucer has developed two innovation pathways: one to enhance existing lines of business through pushing the boundaries of existing coverage and another to test brand new products and markets which have the potential to become major lines of business. Key themes of interest to Chaucer include weather risk, climate change, intangibles and parametrics.

Chaucer has partnered with several companies as it has built its innovation portfolio. Some examples include:

  • K2 Parametric, a parametric insurance provider for commercial companies, which develops bespoke indices specific to client needs
  • Kita, the first carbon credit insurer
  • Crown Jewel, the first trade secret insurer
“Clients increasingly require creative solutions from their (re)insurer. This is a tremendous opportunity for the industry to seize. Whilst there is a real cost of doing nothing, the motivation for investing in innovation should really be more carrot than stick. There is so much opportunity, the question is really where to focus next”.
Dr Hayley Maynard
Head of Innovation


Published on 24.11.2023