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Industry leader and legend Martin Reith joins Georgie Simister to explore how tradition and technology can work together to reshape the future of specialty insurance.
Creators and Guests
What is Insurance Technology: Fact or Fiction??
Host Georgie Simister speaks with key insurance industry figures to separate fact from fiction in a world of insurance, debunk industry myths and explore the game-changing innovations shaping its future.
Get in touch to suggest our next guest: https://artificial.io/contact/
We often hear AI is coming for your job. But the real truth is, it's not AI, it's the people who know how to use it. In the world of insurance technology, we are constantly facing the challenge of tradition with quotes like, It's just the way we've always done it. And now there is the new fear, AI is taking your job. Welcome to Fact or Fiction with Artificial hosted by me, Georgie Stavister.
Speaker 1:This is the podcast that separates fact from fiction in the world of insurance, debugs industry myths, and explores game changing innovation shaping the future. On this episode today, we have Martin Reith, a leading figure in the insurance industry, founder of Ascot Underwriting, and who brings over forty years of experience across the sector. He has deep expertise in distribution, balance sheet optimization, capital management and emerging insurance technologies. He now drives innovation as CEO at Valente Global and is advisor to Aquashore International and is chairman at Artificial. In this episode, we will explore what insurance traditions really mean, the importance of having the right balance between tech and humans, and how the market needs to stay relevant and adapt to new technology advances.
Speaker 1:So welcome, Martin. It is great to have you here.
Speaker 2:Lovely to be here. What a list of things I've achieved. That's very generous of you.
Speaker 1:Well, I was also... I was looking on your LinkedIn in preparation for this, and I think if I It's
Speaker 2:quite a read, isn't it?
Speaker 1:It was. If I was to list off everything, I think we'd take up the whole podcast episode. But it does position you nicely to be able to share your expertise and talk perfectly about if you could teach a traditional industry new tricks. I'm gonna kick us off easily, and I'd just like to ask you, considering you've been in it for forty years.
Speaker 2:Yes.
Speaker 1:What is it that you enjoy most about being in the insurance industry?
Speaker 2:Well, the industry has been very kind to me, I have to say. So as you pointed out, I've been forty years in the industry, started in October 1984. And you make your own luck to a certain extent, but I think the industry is such that if you have the ability and the willingness to work hard, to get in early, to thrive, It really, really does support you in the... In in that endeavor. So for me, it's been a wonderful experience.
Speaker 2:I'm not quite out yet. As you say, I've got a few things go... On the go at the moment. Before the podcast, we were talking about how I'm being described more recently. So I'm I'm being termed seasoned and a veteran, and that's fine.
Speaker 2:That's fine. I've I've got no issues with that. But, no. It's a it's a great industry and one that I I I really think has got a long way to go. Yep.
Speaker 1:So the insurance industry is known as being stuck in its ways or traditional. What is it you think of when you think of insurance traditions?
Speaker 2:Well, tradition isn't necessarily a bad word, and I think I think that's important. I accept that it has connotations about being a little bit old fashioned perhaps and stuck in the mud. Perhaps it's a little incongruous when we think about the way the industry is evolving and and has to evolve. And maybe we should embody other descriptors like dynamic and evolving and tech enabled. But tradition is a sentence or a word that talks about utmost good faith in the insurance world, the pooling of risk, indemnity, underwriting discipline.
Speaker 2:I mean, are all fine qualities. And I don't think we should dismiss tradition. I think they should be the bedrock of what we do, but let's use it as a springboard from where we can evolve.
Speaker 1:So a lot of insurers and brokers actually have traditional written on their websites. And so do you think that they're using that word to be advantageous? And do you agree with that then?
Speaker 2:I don't see an issue with it. I mean, traditional can be seen as a badge of honor or even a warning sign, actually, depending on whether you associate it with reliability or with inertia. But I think the fact that it, to me, it's around trust, stability, and continuity. And having insurance entities use that word as part of their description, I think is absolutely fine. It's a long standing insurance market.
Speaker 2:Hundreds of years of tradition have gone into shaping the market where it is today. So I don't have an issue with it, but let's not get stuck in it. Let's evolve it too.
Speaker 1:Do you think it puts them in a box?
Speaker 2:No, I don't actually. I think it's a great bedrock from which to build. And I think customers coming into the insurance industry looking at where they should buy their insurance, they're looking for reliability and stability and trustworthiness. And having the traditional badge is a good thing, but also having the ability to develop and be more dynamic is also a good thing. So I think they can coexist.
Speaker 1:I think as well when if you are a customer, tradition means that you've been around a long time, you bring in expertise versus then if you were to look at the new kid on the block, you always have to worry about the longevity and what they're actually bringing. So I do... I agree it definitely brings in a positive element to the industry.
Speaker 2:Yeah. I I think the market also needs disruptors, but disruptors don't necessarily have to be non traditional. They can have their foundations in a traditional sense, but they're just looking to evolve and to find different ways to be challenging in the marketplace.
Speaker 1:Okay. So if I was to date you back to when you founded Ascot Underwriting Yeah. What were the key developments in technology or culture that helped you grow your business in the early days?
Speaker 2:Well, so I started Ascot back in 2001, so quite some while ago now. I find it odd that it's twenty five years ago. It feels like just yesterday, actually. Technology then was somewhat different to what is available today. But certainly with Ascot, part of what I tried to achieve there was bringing together a collection of entrepreneurs, of market specialists, and we absolutely embodied any and all technology that enabled us to be better.
Speaker 2:So if we could deliver better outcomes for our clients, for our distribution chain, then that made sense. But in those days, Geordie, it was more around models associated with pricing or exposure management that enabled us to make more informed decisions. It was less around automated processes, which is where, of course, the market's heading more today. So at Ascot, absolutely we embedded that. Lots of stories around how the early days of technology really helped us, but also gave us a lot of fun.
Speaker 2:There's tremendous stories around... Ascot was a really fun place when we started. There was 14 of us in 2,001 pretending to be a much bigger company. And we used to mess around terribly by moving, changing the left and right clicks on mouses and taking out... You remember mice used to have balls underneath that moved the cursor, so we'd remove the the ball or something.
Speaker 2:So silly things like that, but it it it was a lot of fun. But, no. Tech played a very significant role in in Ascot. And you look at Ascot today, it's absolutely a force to be reckoned with on the global stage.
Speaker 1:Well, we can't do that anymore. They've removed the ball from a mouse, so we're gonna have to find new ways to have fun.
Speaker 2:You're absolutely right. That was a classic. That was a classic.
Speaker 1:I'm missing out in my generation. So you've transitioned from founding a traditional underwriting firm to your current role as chairman artificial and also a senior adviser to Aquashore, who have written on their website, human expertise meets advanced technology. Why do you think the balance of tech and people is so important? And are you unique in that way of thinking?
Speaker 2:So I wouldn't say we're unique, but I would say that we're pioneering. And I think those that recognize the benefits of technology adoption early and embrace those qualities will create advantage. And fundamentally, key to that is that we secure the best coverage and terms for our clients. At the end of the day, we only exist to serve for our clients. And a blend of human expertise that uses technology to achieve that should always deliver the best outcomes.
Speaker 2:My career for the last forty years has really noticed the importance of relationships in this industry. That will never change or I hope it never change. To me, it's a coexistence of technology and people skills that make this industry the best that it can be.
Speaker 1:And I think if you... To look at what artificial does and it removes the mundane tasks that actually allows people to spend more time with people, it removes, you know, and other technologies, but it's removing that admin or labor intensive stuff that enables you to spend more time building those relationships and solidifying what the market is about. And that's where I think technology is really important to come into the market. As you said, it's not to replace people, but it's to enhance their roles so that they can do things that technology can't. You can't have AI bots meeting an underwriter at a box.
Speaker 1:You know, maybe one day we'll get there, but that's where I've
Speaker 2:been AI bot. Be a disaster, Marty.
Speaker 1:I think that's where technology really can play a part, and it's just bringing people along in that journey, knowing that it's to be embraced and it's not something to be feared. And I think that's where we'll see hopefully that pivot in the market.
Speaker 2:But look, think that's exactly right and people need to understand that. People shouldn't be fearful about machine learning or AI. Quite the opposite. If it helps you achieve better results, if it improves your knowledge and enables you to make better informed decisions, let's embrace it. Let's not fight it.
Speaker 2:And it doesn't need to replace anybody. It can work absolutely in conjunction with a regular workforce. Key for me in all of this is how, as an insurer, am I able to look at and review more risks more efficiently? The initial phase of underwriting is the triage. Does this risk fit anywhere within my risk appetite?
Speaker 2:The more risks that I can oversee and make that determination in the quickest amount of time, the better. Ones that pass muster and do make sense, I'll spend more time on. That's fine. But that initial triage, that initial filtering of what fits within my risk appetite, Absolutely, automation must help with that.
Speaker 1:I also think it's not just the risks that fit within your appetite. Right now, do people have time to be logging all the ones that are outside of appetite? And that is real valuable data that no one realizes right now. But down the line, if you have a pool of risks that are coming to you that are, you know, somebody's sending you a load of risks that are outside your appetite, but could you then reevaluate because there is so many risks coming through that you could potentially write in the future? You then have that data stored that's ready for you to collect and utilize further down the line.
Speaker 1:Right now, I think it's it's just not seen as valuable, and I think it's bringing data collection earlier down the chain that's really gonna help in the future as well.
Speaker 2:Oh, look, I completely agree with you. That's a fabulous point to make, actually. So capturing all of that data is so essential. So I may have a view when I insure a bunch of houses, for example, that only like houses with blue doors. And I may be convinced that that's exactly what I should be doing for the reasons that I have.
Speaker 2:But actually, we're collecting data on the universe of risk of houses. Actually, might be that I need to write yellow doors rather than blue doors, and the data can actually demonstrate to me that yellow doors are a better risk than blue doors. So having that knowledge is the most important thing. Otherwise, you're just mildly obsessed with what you think you know and actually not what the data is telling you. That's the important thing.
Speaker 1:You summed that up a lot nicer than what I was saying. But yes, you are very right.
Speaker 2:I can do doors, I can do lorries as well, actually. Can color lorries differently.
Speaker 1:Martin has no preference. I'm going to take you back to the earlier days in insurance. So I attended an ESG event and the CEO of Willis Towers Watson was talking about AI and kind of how the importance and the governance around it. He mentioned that in his early career, there was the introduction of mobile phones. And he mentioned that in those days, people thought mobile phones were coming for their jobs.
Speaker 1:Can you talk us through how phones have shaped the market and how the technology was perceived at the time?
Speaker 2:Yes. So the evolution of mobile phones, not a topic I thought I'd be addressing necessarily. So I think the key thing is that a mobile phone is a tool, whereas AI, I guess, feels a bit like a challenger. So the nervousness around it, I understand.
Speaker 1:Can I wait, sorry to interrupt? Can I dig into what you mean by a tool versus a challenger?
Speaker 2:A phone enables you to do your work more efficiently, and I guess there's a bit of a parallel with AI. But all it's doing is working with what you have, whereas AI is enhancing and enriching what you don't have and potentially therefore could be seen as a challenger. So could a phone replace you? No. Could AI replace you?
Speaker 2:Some people think so. I don't think so, but some people do. So that's why I describe it between a tool and a challenger. But the phone morphed massively. Again, I'll give you a little benefit of my history in this marketplace.
Speaker 2:So in the mid nineties when there was a lot of wars raging in the Persian Gulf, I used to be quite a major leader of war risk insurance for shipping an aircraft. And that was in the days when my children were quite young and we used to go off and have holidays in cottages around The UK. And in the mid nineties, I was issued by my company with a phone the size of a brick, literally. You've probably all seen them on TV programs. And this one was even more special.
Speaker 2:It actually had a cable on it that went to an... To into a sat... An antenna that picked up the satellite. So when I was at a cottage in Wales and I didn't have much of a phone signal, I used to have to put this thing on my roof of my car so I could get access to a signal. But we had to because in those days, we were insuring ships going into the Persian Gulf or aircraft landing in areas around the Persian Gulf, they needed quotes within hours.
Speaker 2:So we had to do that. But of course it's evolved massively now. We all live on our phones and I certainly live on my phone. So it's indispensable without it. I think if the way the phone has evolved and been embraced by the industry, that's great.
Speaker 2:It shows that we can be like that. And let's hope we can be the same with AI as well.
Speaker 1:Whose responsibility do you think it is to help people embrace AI?
Speaker 2:I'm not sure it's anybody's responsibility necessarily. I mean, I'm great believer that people need to be aware of their surroundings and environment in ways to better themselves and better the experience. Clearly though, in a world of insurance, we have to be mindful of regulators. We have to be mindful of our clients' expectations. We have to be mindful of our capital's expectations.
Speaker 2:But at the end of the day, we're all pushing in the same direction and that is to improve the experience and make it more efficient and deliver better outcomes. So I think insurance brokers, I think insurance underwriters, they all have a responsibility to make sure that their staff are fully aware of technology and that they embrace it. Mhmm. But at end of the day, I think the individual has to show the most drive to adopt.
Speaker 1:I've mentioned this before to you. So Artificial did a coffee cart outside Lloyd's. Yeah. And I'll say this politely, a white haired gentleman came over to get a free coffee. Yes.
Speaker 1:And I explained what Artificial did. And he shouted back to his team and went, AI is coming for your jobs, everybody can go home.
Speaker 2:Yes.
Speaker 1:And that gentleman is, you know, he's at a certain point in his career. I also then met a younger female. She was an underwriting assistant. And again, she was fearful of AI. So how do we help the mindset change of those people and how can we bring them along on the journey?
Speaker 2:It's a great question and I hear it many times myself. I mean, I think it's a misplaced fear, frankly, but I sort of understand why people are concerned about it. So fundamentally, knowledge, understanding, and acceptance is the is the most important thing. So don't be shy to inquire. Don't be shy to ask questions.
Speaker 2:Don't be shy to investigate further and understand how you can work in conjunction with new technology. But I do understand a lot of people have a fear of the unknown. A lot of people have job displacement anxiety. There's a lot of misinformation, I think, around this on social media. And social media amplifies the extreme narratives, creating often a distorted view, not helped, frankly, by Hollywood, when you look at films like Terminator and Ex Machina and Black Widow who portray this dystopian world of AI automated bots that control the world.
Speaker 2:But that's not the way it's gonna be. I understand there's a fear around loss of control, and of course, there's ethical concerns around bias and discrimination as well. So get all of that. But fundamentally, you have to understand it and you have to embrace it. And if you resist it, you won't achieve anything.
Speaker 2:This is a technology. This is a time in the marketplace that you ignore at your peril, in And my it's the early adopters that will thrive. It's those people that will shape the outcomes and determine the role that AI and machine learning plays within this industry. So honestly, it's not a time to be fearful. It's a really exciting time of adoption and embracing.
Speaker 2:And look, I'm an old fogey in this market, and even I get excited about it. So there must be something there. And if I was 25 or 30 today in this market, goodness me, what an exciting time this would be. There's a talent gap too. And I'm not saying it's an age talent gap, but it probably is.
Speaker 2:So some of the old crusties like me have a natural or a more innate fear around technology. But those youngsters coming into the market, what an opportunity for them today. I mean, what an opportunity. So please, let's try and dispel these fears. This isn't Hollywood.
Speaker 2:This is a proper regulated business. And I think it offers a huge opportunity for people.
Speaker 1:What do you think are the biggest barriers the insurance industry face when we're trying to evolve?
Speaker 2:So I put it into three categories, really. So the structural, cultural, and external. And I think we have to be aware that we have outdated and costly legacy systems within our industry, and that hinders integration with modern tools. We've got regulatory complexity and approval cycles that can be long and vary enormously. We need stability over speed.
Speaker 2:Change is often slow because leadership generally in this industry are conditioned to play it safe. Data, it's often unstructured and fragmented. And clean, real time data is absolutely essential for algorithmic underwriting or predictive modeling. I talked about the talent gap a moment ago. There is a talent gap.
Speaker 2:We need to find talent that understands and embraces insurance and emerging technology. The other aspect, candidly, is trust and transparency. I think it's... If you don't understand it, absolutely, you'll be suspicious about it. So I think that's how I'd categorize the Paris as I see them.
Speaker 1:So when it comes to embracing new technologies, where do you recommend a company should start?
Speaker 2:The starting point for any company in this area has to be data, and it has to be big data, and it has to be how we ingest that data, enrich that data, and then use that data. The market has tried over many, many years to digitalize itself. The market is littered with failures to do so, fraught with finding a common path amongst all the market practitioners. We are now all very hopeful about Blueprint two and what that can do for us. It's been delayed.
Speaker 2:It's been delayed for a long time. And that, I'm afraid, leads to a slightly fragmented market, which was not meant to be the desired outcome. So it has to be all around how we ingest and use data. Once you have data in your system, what you can then do with it is limitless. You have the power and the knowledge to be informed and to make better decisions around it.
Speaker 2:So how companies obtain data, ingest data and enrich data, I think is absolutely fundamental to this industry today.
Speaker 1:So now for our final segment. This is the artificial insight. So this is where I would like to ask you your future facing take on the market. So what do you think the insurance market would look like twenty years from now?
Speaker 2:Well, I hope very much that it remains a relationship driven marketplace. I don't see that changing. As I've said to you before, I've been in this forty years, so two lots of twenty years. And actually the common theme has been relationships and people interaction has prevailed and will continue to prevail. I don't see a market full of bots that's doing the work.
Speaker 2:There may be a larger degree of automation in the underwriting process, and I think that's right. With AI helping to evaluate risk and pricing policies using real time data, I don't see an issue with that. But when you think about the London market in particular, it's famed for its ability to underwrite complex risk. And I don't see AI really replacing any part of the human input into that evaluation. I can see technology helping us make better decisions around that.
Speaker 2:So I see a more streamlined process. Absolutely. I see tech playing a bigger role in many aspects of what we do. But I fundamentally see a market that's still founded on human interaction and relationships. And I always think they achieve the best outcome.
Speaker 1:I agree. And if you were to give advice for the next generation of this insurance industry, what would it be?
Speaker 2:First of all, it's a great industry and I would encourage anybody to come into this industry because it offers tremendous opportunity for everybody. But there are key things that I think people need to do. One of course is to work hard. I'm slightly amazed often that... I'm afraid I'm not a great fan of working from home, which is probably a very controversial thing to say on a podcast, but hey, I've said it now.
Speaker 2:So I'd like to see people be in the office. You learn more, you interact more. It's a relationship business that we've been talking about. I understand there are reasons why people have to work from home. That's fine.
Speaker 2:But if you don't have to, I would encourage you to get into the office and to work hard, to embrace change, and to be kind. And I think somebody said to me, I forget who it was now, he said, As you progress in your career, always be kind and mindful of those people that you will meet on that journey because you never know where they will end up at the end of your career. And what you don't want to do is get there having upset a whole bunch of people who just despise you. So just be kind and work with people on your career journey is what I would say.
Speaker 1:Well, you very much, Martin, for sharing your forty years of experience with us. I fully enjoyed this chat. And thank you very much everyone for listening. Please get in touch via the link in the show notes and drop us a message for what practical guides you would like to hear on the podcast.