Speaking at the International Union of Marine Insurance (IUMI) annual conference, IUMI Data and Digitalization Forum Chair, Patrizia Kern discussed big data, the use of digital technologies, and how the COVID-19 pandemic has put digitalization on the fast track.
“Digitalization is not an option anymore - it is here to stay - and the marine insurance sector needs to keep pace," said Kern. "For some time now, the shipping industry has been seeking cost-effective ways to operate and key logistics players have already begun to partner and digitalize the global marine supply chain. The current pandemic has accelerated this process and marine insurers and underwriters need to upgrade their skills and embrace digitalization to minimize the risk of becoming redundant in the future."
Historically, traditional underwriting practices have relied on scant risk data and manual processes which have resulted in inadequate risk assessment in many instances. Digitalization can address this, as Kern explains:
“Digitalization optimizes the supply chain and offers a more sustainable future. It allows for a total re-thinking of the way that the logistic industry operates. Thanks to evolving client data lakes and the adoption of advanced technologies, new opportunities have opened up also for insurance companies to improve the service we deliver to our customers. Our industry is a people- business, with personal relationships at the heart of what we do, but COVID-19 has shown us that we can still maintain these relationships whilst embracing new technologies.”
Kern also highlighted how the use of big data and digitalization is not without its risks and pitfalls. The insurance industry is highly regulated and marine insurers must operate within many legal and compliance frameworks.