By: Luke Jones, Published on January 12, 2017 07:40 AM, Last Update on January 13, 2017 02:03 PM
The property and casualty industry in Canada needs to make its strategic plans for the long terms to ensure it can managing developing technologies and changes to the industry. That’s the opinion of Philip Cook, CEO of Omega Insurance Holdings Inc., who was speaking on Wednesday at his Industry Trends and Predictions: 2017.
At the moment, insurance companies see long term planning is around 18 to 24 months. However, Cook says the industry needs to look further and that the industry has “got to start saying what will we look like in five years’ time, and perhaps more important, what will we look like in 10 years’ time,” he said.
“If we don’t have a vision of that and start planning around it, we might find ourselves left in the dust,” Cook cautioned. “It might be too late by the time we see the changes.”
Predictive modelling is often used to assess how the P&C industry in Canada will progress and adapt in coming years. The problem is, predictive modelling has been flawed, for example the Brexit and U.S. elections in 2016 went completely against predictive modelling. Cook admits the flaws, although believes insurance companies use better modelling.
“I think, generally, the predictive models used by our industry are a little more reliable, but they’re still flawed and I think we need to recognize that,” Cook emphasized.
Simply relying on a model to see how the industry will look in the coming years is not enough. Instead, insurers must start looking at a wide scope.
“We have to go outside of that and start thinking about what is the vision for our industry, what will it actually look like, what will its consumers look like, how will we get to those consumers or how will they get to us?”
“If we just look at the trend itself, we miss the point. We need to look behind the trend to determine what’s causing it because that’s really the future for our industry, and most other industries, in terms of designing product that’s attractive to the consumer. We need to address their needs, not just their wants,” Cook added.
“Once you start to look at what’s causing them, you can start drilling down into what sort of products and services going forward we may need to supply to our consumers,” Cook suggested to attendees.