The largest reinsurers are investing resources in these areas. For example, at Munich Re, we’re investing in understanding emerging risks, such as climate change, and developing private market solutions for specific perils, such as flood. We’ve established a global data analytics team and have staffed it with a sizable team of talented data scientists and engineers. We’re making these resources available to clients and working with them in a number of areas, including developing risk scoring models using predictive analytics to improve risk selection. Another example is the development of a claims detection model that is designed to improve loss outcomes.
Regarding InsurTech and innovation more generally, this is another area in which we’ve made a significant investment. For example, we put boots on the ground in Silicon Valley several years ago to acquire a strong understanding of the ecosystem, including InsurTech startups. As a result, we’ve acquired a deep and broad network of relationships in this area that also include investments and other partnerships. We’re making these resources available to clients and working with them to enhance their innovation capabilities. AM Best, for example, recently announced that it will include an assessment of an insurer’s innovation activities in its rating assessments.
Our efforts in innovation have been increasingly recognized. A recent Willis Towers Watson survey showed that Munich Re is considered one of the top two most innovative insurance organizations in the world. Please see my recent message
on the importance of innovation to business’s success.
So, while the outlook for growth in the U.S. casualty reinsurance market is generally positive, it’s clear to me that innovation will continue to play an important role in insurer’s performance in the changing landscape.