View from the top: 2012 — the start of the future?

Some of you will probably associate Zurich with change. After all, we brought you ‘Because Change Happenz’. But are we done with change for a while? In fact, I’d argue the opposite.

Reflecting on the past 10 years, the insurance industry has seen a level of change not witnessed in the previous 50. A major catalyst for this has been the increasing pace of technological development. But we’ve also observed huge economic, political and regulatory change and the sands are shifting so quickly that even monumental political decisions with far-reaching consequences are being decided, seemingly overnight.

The conflict between global remedies for global problems and, at the same time, national, protectionist decisions presents an interesting dichotomy for
all concerned.

I believe we are at a real inflection point and the winners will be those who turn complexity into opportunity, adapting to survive and innovating to win.

So, I have four priorities. Firstly, a focus on the fundamentals. We are insurers; we do not make widgets or hi-tech gadgets. We are a people business and what we sell is a promise — a promise to our customers that, when it matters, we will be there when they need us. As such, we have to be responsive and deliver the advice and products customers want in the way they want them. We can only do that if we have the right people. So, we have to recognise and invest in skills.

Secondly, we turn to market segmentation. We have to choose our battlegrounds. The industry can’t be all things to all men. That may seem strange coming from a multi-market, multi-segment global insurer but we must focus on areas where we know we can deliver for our distribution partners and customers.

As an industry, we also have to create the capacity to think. History tells us that it is rarely the present incumbents who are the innovators; whether you look to examples such as Direct Line or, more recently, the evolution of aggregators. As an industry, we must lift ourselves out of today’s operating reality to stay abreast of developing trends, especially during a period of real change.

Finally, we need to find intelligent ways to either replace or bypass the constraints of our legacy IT architecture. This is critical if we are to provide our businesses with the agility to remain relevant in the market of tomorrow.

So, as we start 2012, take some time to look not only at this year’s plan, but also consider the plan for 2020. The future starts now.

Happy New Year!

Stephen Lewis is CEO, UK general insurance, Zurich