Insurance Must Be Reimagined, Says New Insurance Report by DAC Beachcroft - DAC Beachcroft

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Insurance Must Be Reimagined, Says New Insurance Report by DAC Beachcroft

Published 12 September 2018

A new insurance report, Insurance Remodelled 2018/19 Market Conditions & Trends, published today (12 September 2018) by international law firm DAC Beachcroft, examines how the firm's insurance experts predict the general insurance market must be reimagined in order to respond to the changing nature of global risk.

Introducing the report, Helen Falkner, Head of Insurance at DAC Beachcroft, explains: "As the nature of risk continues to transform in this digital age, insurance must change with it.

"The very nature of insurance, its role and its relationship with society is undergoing a profound and irreversible transformation," says Faulkner. "The biggest drivers of this change are technology and globalisation, but alongside them is the changing nature of risk.

"As we explain in our lead article, the combination of these powerful forces is not just reshaping the insurance industry; it's demanding that we reimagine what insurance is for, what society expects from it and how it can deliver the promises that lie at its heart. It also means reimagining the skills insurers and brokers need."

The report also includes three in-depth analysis pieces that explore issues relating to cyber, natural catastrophes and global supply chains. In Cyber, Conflict and Cover: time for a rethink? DAC Beachcroft's Head of Cyber, Hans Allnutt, and partners from Legalign Global consider where the boundaries lie between commercial cyber risk and war or terrorism risk, and the 'shrapnel effect' of major cyber-attacks affecting policyholders worldwide that were not the primary target.

On natural catastrophes, the report questions whether the market can withstand the storms and considers how escalating losses are prompting the expansion of parametric insurance and cat bonds, challenging traditional models of insurance cover.

The third thought leadership article discusses the 'mind-boggling' complexities of global supply chains, the risks and challenges they bring and how insurance can contribute to resilience and business continuity.

In addition, the report contains 50 predictions, made by DAC Beachcroft's insurance experts across 14 different lines of insurance business. The impact of InsurTech features in many. Among the predictions, for example, is that as crypto-currencies mature and become an everyday part of commercial life, they may offer real benefits to the reinsurance market. The first 'financial scalp' for a breach of the GDPR is expected to be taken by a European regulator in the first half of 2019. While technological innovation such as artificial intelligence may promise operational efficiency and gender equality, the report warns that it will also bring new responsibilities for board directors.

The report concludes with summaries of the key legislation, cases and other legal developments over the past 12 months. For a copy of the report, please click here.