QBE’s practical tool to help tame risk
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A new commercial risk management platform offers a more collaborative approach, streamlines processes and contains data seeds that will help push insurance into a more proactive role in risk mitigation
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VISIONS OF a brave new data-driven world and how it will allow organisations to share and collaborate across market boundaries and create better value propositions for customers have proliferated since the pandemic.
But in insurance, the reality often lags behind the ideal, especially when it comes to tools that can corral large amounts of information and render it useful in the task of nudging clients towards less risky behaviours.
It’s a known problem that attracts many theoretical solutions, which is why QBE’s new RiskAdvance digital platform may mark a turning point for an industry seeking to move towards a practical preventative model of risk mitigation and away from old paradigms that simply compensate for losses after the fact.
Rob Kosova, general manager, commercial at QBE Australia Pacific, knows that this is an industrywide issue.
QBE Australia is part of the QBE Insurance Group, an international insurer and reinsurer headquartered in Sydney with offices across all states and territories. At QBE we’re driven by our purpose – enabling a more resilient future – and our vision: to be the most consistent and innovative risk partner. We provide a broad range of insurance products and risk management solutions to personal, business, corporate and institutional customers – from car and home insurance to tailored business packages and specialist cover for industries such as aviation and farming.
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Technology such as AI expected to transform insurance
“What the RiskAdvance platform does is it streamlines how we govern and manage requests for coverage”
Rob Kosova,
QBE Australia Pacific
“All insurers try to understand the customer’s level of risk maturity in order to [decide] what capacity they have to offer … the way we do that at the moment is by sending our survey team out – they observe things, collect information and send it back, so it’s very manually intensive,” he says.
It’s also a highly inefficient way to collect and measure the data needed to plot levels of risk.
“What the RiskAdvance platform does is it streamlines how we govern and manage requests for coverage,” Kosova says.
Customers and brokers can go online and interact with the platform in a self-survey process that generates tailored insights and solutions to possible risk exposures. They can either upload evidence showing that preventative measures are in place or, if they are not, gain a better understanding of why their premiums may be higher as a result, and what can be done to reduce them.
“The platform is designed to modernise how businesses monitor, manage and build their risk maturity,” Kosova says. “We want to spend more of our time trying to be predictive and trying to nudge customers to take on the types of risk management behaviours we know make a difference, so that they don’t suffer losses.”
Typically, an insurer might send a team out to a client site and produce a report about possible risks with areas for improvement. It’s largely a one-way transaction.
“Is that partnering? Or is that kind of judging to a degree? If you produce a report and just send it out, and then never tell anyone what you’re doing with that information, there’s probably more judging going on,” Kosova says.
With the RiskAdvance platform, two-way collaboration is built in. QBE can provide a notification about the current status of the customer’s business and where it sits on a sliding scale of risk due to factors revealed in the survey. It can also ask for more information to be uploaded to clarify a certain situation that may shift the position on the scale.
RiskAdvance will directly inform brokers and agents of potential risk improvements for their customers and give brokers, agents and customers the ability to easily update the status of their risk improvements.
The introduction of the digital platform also sets the stage for further enhancements; nearly half of risk and compliance professionals at insurers are expecting new technologies such as AI to exert a transformative or major impact on the industry, according to Moody’s Analytics.
For the customer, the main advantages of using RiskAdvance derive from the fact that the surveys can be taken when it suits them and can be revisited later.
“The opportunity to self-survey when it suits and upload that into the platform or even have your broker do it … that’s only one benefit, giving time back,” Kosova says.
Being able to interact with the platform and measure improvement will help customers keep track of their risk status, not only with regard to changes they make but also in terms of emerging risks that QBE can flag as the external environment evolves.
“[As a large multinational], we’ve got insight into things that are happening in global markets around managing certain risks, and we can build that in digitally – and customers will get access to these insights almost immediately, rather than
In this way, RiskAdvance effectively creates benchmarks for companies to measure themselves against, and continually updates those benchmarks with the latest insights into individual cases and broader trends from overseas markets. “It’s almost like a live status of best practice risk management, which will give organisations more certainty around [taking steps that have been proven to reduce risk].”
The result should be fewer claims, insurance costs that are more stable and predictable, and less downtime for businesses because loss events have been prevented before they occur.
The system also helps support broker outreach efforts by offering an opportunity to engage directly with customers during the survey process.
“Brokers can sit with their customer and complete some of the survey, or can complete the survey through a video call, which may help them get into a customer’s calendar and better discuss their individual risks,” says Kosova, noting that surveys done by email can sometimes prevent that kind of tailored conversation.
Having concrete mitigation steps (or the lack of them) to point to when talking about price will also make the broker’s job easier.
While a number of companies have realised the need to more actively tamp down risk impacts in the post-pandemic world, there are few that have practical tools on hand to implement such a change.
Research shows that consumers worldwide want insurers to approach risk in the business world by moving from compensating for a loss that occurred in the past to predicting the impact of a risk and providing solutions to protect against it
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Advantages of new platform for both customer and broker
A step on the road to preventative insurance
Published 04 Dec 2023
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“We want to spend more of our time trying to be predictive and trying to nudge customers to take on the types of risk management behaviours we know make a difference, so that they don’t suffer losses”
Rob Kosova,
QBE Australia Pacific
Insurers expect the impact of introducing AI within risk and compliance to be:
Transformative
17%
Major
32%
Moderate
36%
Minimal
13%
None
2%
Source: Moody's Analytics Navigating the AI Landscape report 2023
Source: Bain & Company’s 2023 Global Insurance Report
Customers want prevention, not compensation
of Australian consumers
are highly interested in insurers’
risk prevention services
90%
A more collaborative approach to measuring risk
waiting for the next time a risk engineer comes out to visit,” Kosova says.
“We take that surprise out of it ... at pricing time, the decisions are much more consistent with where we think [a customer] should be based on city, industry, geography, location, risk, among other things.”
Removing the need for a survey team to complete a report and then send it to the underwriter to read also makes the entire process more efficient, one of the aims of the platform.
“[While] we are simpler to do business with than we were prior to RiskAdvance, it’s not about gaining more business with brokers; it's knowing that we can service our current brokers better and we can be more consistent using digital,” Kosova says.
With 400,000 customers on file, perhaps the most exciting feature of the new tool will be the data it’s able to collect, and how this data can reveal which mitigation steps work and which don’t in different risk situations.
In certain businesses, the same types of issues arise repeatedly, with any number of countermeasures implemented to try to reduce risk. The data from RiskAdvance will reveal which methods are most effective in a real-time, real-world testing situation.
“With our current understanding around the types of claims we have, when we look at the root causes, we can ask, ‘are those controllable?’ and ‘what are the potential controls?’,” Kosova says. “This gives customers access to our deep knowledge around what good [practice] looks like.
“There is almost an assumption that [certain steps will mean a customer] shouldn’t have certain claims. If these practices are valid, over time the data will reinforce that through those customers having fewer claims. And then, if we do get claims, it helps us challenge some of our assumptions.”
Having the risk data married with the claims data will allow QBE to be more accurate around the types of activities that prevent losses, potentially saving customers money and preventing unnecessary losses.
The narrow role of insurance in covering an unexpected loss thus subtly shifts to a broader role in which insurers like QBE actively work towards reducing risks or preventing them from arising in the first place.
“What RiskAdvance will do is help us spot longitudinal trends, as humans in terms of risk management aren’t particularly good at detecting slow change over time.”
A treasure trove of risk mitigation data
before it eventuates – either circumventing it altogether or bringing its impact down to an insurable level.
Talking about preventing disasters before they happen sounds like science fiction, but it’s essentially risk engineering taken to its logical acme point.
While insurers may not have the ability to predict the future, the property market or the fates of societies, RiskAdvance is an important salvo in the fight to show customers the consequences of not mitigating against risks, and promote to them the best methods to help prevent unnecessary damage.
“It sets a standard, puts some guardrails in place and encourages customers to invest and manage risk in the right areas to make a difference,” Kosova says. “It should encourage more customers to [take mitigation steps], and they should get an outcome of more certainty and pricing more quickly than if they were left to their own devices.”
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