Sarah Nicholas

Last week saw the Economist Events’ inaugural World Water Summit, convening leading authorities on water management, governance and policy, sanitation, international development and innovation. Staffing the press desk for the Summit, we had a busy day securing no fewer than 34 interviews between speakers and media, and listening with interest to the discussions bouncing between keynotes, panellists and an expert audience.

An interesting theme raised by several speakers was the need to end the ‘stand-off’ on communicating the issues around the water crisis, whether this is companies talking to their investors, shareholders asking pertinent questions, or governments and NGOs campaigning to change toilet habits around the developing world. With the first UN World Toilet Day being celebrated next week, the stalemate is thawing around the ‘loo taboo’, with speakers from agribusinesses such as Syngenta, environment ministers from around the world and non-profit organisations such as WaterAid and the Gates Foundation pursuing ‘faecal sludge management’ systems as innovative solutions to expensive sewerage infrastructure. News that only about 35% of government-built toilets in India are used shows that infrastructure and innovation must be combined with a sustained communications campaign to change aspirations and behaviours.

In the financial community too, people are beginning to speak up about water and why it matters for investors. The Prince’s Accounting for Sustainability Project is tasking investors, accountants and businesses to ‘measure what matters’ and consider natural capital as well as the more visible bottom line. Meanwhile, Ecolab is helping businesses to translate the risks and rewards of water management into hard figures and actionable information through the Water Risk Monetizer, launched at the Summit. Never has the time been more ripe to start talking about the real impact of water and sanitation.

Read more in this selection of coverage from the Summit:

The Telegraph – Geoffrey Lean column

BBC World Service – Business Daily ‘Worldwide Water Crisis?’ podcast

Huffington Post – welcome address by HRH The Prince of Wales

Thomson Reuters Foundation – interview with Barbara Frost, CE of WaterAid

Farming First – Key themes for Agriculture

Search #WaterSummit and @EconomistEvents for more lively debate

11th  November 2014

Sarah Caddy

Having recently blogged on the dearth of innovation in insurance, it seems only fair to give stage to those ‘disruptors’ that have emerged to create new opportunities.

A few years ago, industry experts predicted that specialist insurers would disappear. Insurance was becoming more commoditised, heralded by the advent and potential threat of non-traditional industry players, like Google, which purchased BeatThatQuote.com (a one-time Gong client and insurance aggregator) in 2012. Speculation around the internet giant’s threat to the insurance industry through its ability to innovate at speed was well documented (here).

And yet we have witnessed a specialist insurance boom. Players don’t have to go on to aggregator sites to keep costs low. Distribution is key; capturing the various distribution channels is the pathway to success. Carving out space alongside the aggregators in a distribution landscape – which, let’s not forget, many thought would be dominated by aggregators only – are a few stand out specialist brokers, such as Hastings Direct (with its low operating cost base and focus on car, van and motorbike insurance) and Brightside Group (which has grown through acquisition since its launch in 2001 as a provider of motor insurance for small businesses).

So what do these companies bring to the insurance space, to make them grow so successfully? So often it is coming down to marketing and technology.

To focus on one small point, take Simply Business, a UK small business insurance broker. From a twitter account (@simplybusiness) opened in 2008, the firm now has 30.6k followers. These followers are attracted to the specialist content targeted to its SME customer base:

Look too at The BGL Group (@The_BGL_Group; 712 followers) – just named “one of the largest mid-market private companies in Britain”, according to the latest Sunday Times Top Track 250. The firm has turned comparethemarket.com into a household name, and is set to shake up the life insurance market with a new marketing campaign for Beagle Street.

We may not be able to predict the future of the UK insurance industry, but these companies are proving that it’s not time to chime the death knell yet.

4 November 2014

Sarah Caddy

If you’re following the right people on twitter, you’ll know that Towers Watson’s #ERMForum took place in the Netherlands in early October. As ever, guest speaker Dr. Pippa Malmgren got to the crux of current insurance debate with her Thought of the Day for TW’s audience of insurance Chief Risk Officers:

How much time are you spending on the big picture risks?

 Very little, it seems. Aon Consultants reportedly lamented last month that insurers are opening themselves (and the world) up to imminent liability by failing to mitigate against global, unprecedented disasters. Instead of acknowledging that new risks such as cybersecurity and hyper-connectivity are desperately in need of insurance innovation*, insurers predominantly continue to focus on smaller risks, such as health and vehicle insurance. This, Aon explains, is because there is a wealth of data and experience available to inform decisions relating to these risks.

But perhaps a more pertinent threat – and one related to product provision – is that posed by ‘local markets’ within the global insurance market. While global insurers like Lloyd’s rode to well publicised success from demand for insurance in faster-growing regions in the past, insurance coverage is increasingly being provided by local insurers and alternative insurance hubs.

As indicated by recent statements by Leapfrog’s founder Andrew Kuper, insurance industries in emerging markets are developing rapidly. How long is it before the competition will reduce the need for brokers to source coverage from London? Signs have already begun, with Catlin opening its Singapore branch to underwrite insurance and reinsurance in the Asia-Pacific region in January 2014.

Recognising this threat, Vision 2025 was launched by Lloyd’s to keep pace with the emerging markets. By proactively developing products in emerging risks, Lloyd’s could confront future competition by making London more relevant – a timely endeavour.

*The notable exception to this – Tom Ridge’s specialist cyber insurance company – was also announced as launching last month by the FT.