Neil Utley is an insurance industry veteran. Having been the chairman at Hastings, he led the management buyout from Insurance Australia Group in 2009 and led the insurer through its initial public offering in 2015. His prior experience included CEO roles with Privilege Insurance and Cox Insurance Group.
In this interview with Percayso Inform’s Managing Director Rich Tomlinson, Neil Utley talks about why UK insurance providers are crying out for flexible and scalable data solutions, his investment opportunity to back one of the most exciting businesses to have emerged in the insurance industry in years, what they hope to achieve together, and more.
Percayso: What are the challenges faced in the UK personal lines insurance market at present?
Utley: Now more than ever, our personal lines market, particularly motor, is the most competitive in the world. Prices are generally obtained through aggregators, and all insurers compete head-on for the same risks. Insurers must have access to every piece of information to enable them to price competitively but also know of the dangers inherent in the risk they are insuring.
What role does data play in helping insurance providers face up to these challenges?
Insurers have value in their own data but can also get a wealth of information from market data. The insurers that succeed are the ones making use of all available data to establish accurate pricing. Being too expensive will lose the risk, and being too cheap will inevitably incur a loss. Just look at the current year’s operating ratio. The winners will be the best players who use the best data.
What does that look like over time?
As data changes, other data becomes accessible at different parts of the insurance lifecycle. When a customer decides to make a claim, the information we hold on them becomes even more vital. Whether they have modified the car, done more mileage than they said, whether there are multiple claims submitted to different insurance companies or factors in the claim common to other claims to other insurers.
Ah, all the vital pieces of information for an insurance company.
We too often see people using the aggregator with different answers to questions to obtain lower quotations. Insurers must root out these people who have caused losses on their books. If used correctly, it’s also a fantastic marketing tool to gain a competitive edge in what is generally a utility market.
Are insurance providers optimising their data strategies today?
Some are, and some aren’t. The ones who are today will be the winners in the future. The old way of doing things is different from how we should go about it in the future. And I suspect the market will continue to change in favour of the ones that are well-informed, current and strategic in their thinking.
Do you think there is a data arms race?
I don’t think it is an arms race, but it’s certainly a war to get the best information. And for providers of that information to get to the right insurers. In a way, it’s always been like this, but there’s never been a time when it’s been so important.
How much does a market-leading data strategy and deployment help insurers be more competitive?
Up-to-date information is relevant at all parts of the insurance cycle. Indeed, at new business, when you don’t want to be burdened by the bad risks, but you want to be competitive for the good ones, but also when a mid-term change is asked for and particularly at claims time.
Walk us through the barriers holding some insurers back from maximising their data strategies?
Legacy will always be an issue. Some are still using systems that are incredibly inflexible in what they can connect to. There is also a potential need for the mindset to change and embrace new technologies and strategies.
In a sense, it’s good for Percayso?
Yes, Percayso’s technology has been created in a very open architecture and can connect to virtually every system out there in the market. It’s shaking things up, that’s for sure.
So on to Percayso. What role do we play in solving issues for insurers working with legacy tech and connectivity issues?
The team has the experience of many years in this industry in creating systems that help insurers. The benefit now is that you have a new system developed from scratch without any legacy issues, built from the cloud up, and speed and flexibility are at the forefront of development.
Why did you decide to invest in Percayso?
There are many opportunities in insurance and many insurance-related businesses seeking funding. Rarely does a month pass by without one or more propositions crossing my desk. Percayso is different, fulfilling a need that exists and will be the platform for competitive advantage in the future. I’m delighted to have invested in the business and become part of its journey – it’s unique with very current live issues to tackle.
And our competitive advantage?
We all know the competitive advantage that data makes, and Percayso is in a unique position to exploit the opportunity.
It’s an exhilarating time for us to have you onboard!
I’ve got every confidence the team will make the most of it and can use my experience of 30 years in the market to help them on both the insurance and corporate side. It is being led by a team that has proven in the past to create a successful business and now has the benefit of a clean sheet of paper.