Christmas Q&A with Mark Bower-Dyke

2019 reflections

Which insurance issue has defined 2019?
Sub-netting. Unrealistic pricing doesn’t help anyone – insurers or customers – in the long term. Policies need to be priced correctly in the first place. Then, unless the customer has claimed or there’s been a fundamental change in their circumstances, prices should fall apart from rises needed to reflect inflation.

What has been the year’s most surprising moment in insurance? 
As above, rates haven’t increased in line with inflation!

Which product launch has made the most impact? 
Continuing advances in telematics are a positive development for customers because they contribute to road safety by making people more aware of their driving behaviour, as well as influencing future insurance costs. The image of telematics has been damaged by some products that effectively fine drivers – that’s not the right way to do it.

How has technology changed insurance this year? 
It’s driven efficiencies – in particular through the increased use of artificial intelligence. It can make applying for insurance and claiming so much easier and quicker for the customer, but it’s never going to take away the need for the human touch – organic intelligence. Robots can’t take over everything because someone has to control them. The more you mechanise, the more organic intelligence is needed to make sure everything works.

What has been your biggest professional achievement in 2019? 
Moving Be Wiser back into profitable growth. 

2020 predictions

What issue will define general insurance in 2020? 
The market’s profitability, which ultimately becomes a bottom line issue. 

Do you expect the market for broker acquisitions to be more active or less? 
Probably more. In this market, organic growth is tight, so making the right acquisitions is a key part of growth strategy.

How do you think the Financial Conduct Authority will rule on dual pricing? 
Their proposals are eminently sensible and should be driven forward. It’s a move to make insurance pricing fairer for everyone, and it should be welcomed by everyone who cares about the reputation of our industry. The outcome we all want to see is that policies are priced correctly in the first place.

Which lines of business will have the most challenging year? 
UK insurance premiums across the board continue to be depressed. They are simply at unsustainable levels and that’s going to be a big challenge for everyone.

What overlooked trend in insurance will gain greater prominence in 2020?
Claims costs could come under the spotlight more than they have, especially if/when Brexit gets done. There’s significant concern that car parts will cost more, so that will be another challenge to an industry already struggling to contain motor claims costs.

Mark Bower-Dyke is chairman at Be Wiser Insurance