Looking beyond

Looking beyond

Christine Bell sees positive times ahead for Swiss Re Corporate Solutions as businesses take a fresh look at how to manage risks

By Wendy Pugh

Christine Bell has taken up the top job at Swiss Re Corporate Solutions in Australia at a critical – and opportune – time following a period of disruption.

Natural catastrophe losses are testing underwriters globally, businesses are facing insurance market challenges and there’s debate about what the “new normal” will look like as firms reconsider their risk exposures.

“I’m not sure we know what a ‘new normal’ actually is, but for all of the uncertainty it has brought, the anxiety, the stress – there has been an abundance of that – I do feel the pandemic has probably taught us many things as well,” Ms Bell tells Insurance News.

“We have probably all learned a great deal around resilience, and from a business perspective it has really put the emphasis on business continuity plans, risk management, and really thinking about the ‘what if’ scenarios in an organisation.”

Ms Bell was named Swiss Re Corporate Solutions Country Head Australia and New Zealand in the middle of last year, taking up the role in August. Previously she was Chubb State Manager NSW/ACT and has held significant roles at QBE and Vero during a three-decade career that started with AMP.

“Swiss Re Corporate Solutions is synonymous with innovation, and it’s an organisation that is all about sustainability and making the world more resilient for future generations, which is inspiring,” she says.

The global primary insurance arm of Zurich-based Swiss Re Group has had its challenges in recent years, leading to pricing increases, portfolio pruning and expense savings. The unit reported a net income rebound in the first nine months of last year and was on track to achieve its profitability target.

“Having observed its turnaround journey as an outsider, the opportunity to contribute to the company’s growth journey is absolutely what drew me to the role,” Ms Bell says.

When she arrived at the company’s Barangaroo base a lot of heavy lifting had already been done around reviewing the strategy and resetting the business. She says it was an opportune time for someone new to come into the local operation, and to bring fresh eyes in taking it forward. Swiss Re Group dates back to 1863, while Corporate Solutions began in 2007, and has some advantages as a relative newcomer that can draw on the global firm’s strengths.

“We are not encumbered by legacy technology systems, and I feel that helps differentiate us in this market,” Ms Bell says. “In addition to that, it’s an organisation that continues to make investments not only into data and digitalisation, but also into operational efficiency, underwriting discipline and excellence.”

The insurer has traditionally been recognised as a property and energy underwriter, with a strong lead position in the mining sector. In other segments it has been more a provider of additional layers of cover.

“We are focusing on our next phase of our journey, which is to make our strategic repositioning sustainable and resilient through market cycles,” Ms Bell says.

The business plans to expand its position as a primary lead underwriter for property and liability, including in mid-market and commercial risks, and is diversifying the portfolio through long and short-tail products, with a renewed focus on primary casualty, and expansion of the professional indemnity and executive risk portfolio.

“The other exciting part of our growth strategy also includes a really strong focus on our international program business in all the primary markets,” she says.

The insurer is increasingly focusing on innovative services that go beyond traditional risk transfer, aiming to get closer to customers and enabling it to understand their data and gain greater familiarity with their businesses and their requirements.

The emphasis on sustainability has included investments that enable clients to quantify the impact of physical climate risk on portfolios currently and into the future.

Climate is one of the biggest risks for the insurance and reinsurance industry and is a priority for the business and its customers, she says, while Swiss Re in general has a strong focus on environmental, social and governance (ESG) issues.

“Through our group sustainability strategy we aim to reinforce our efforts to make the world more resilient, which involves managing and monitoring risks and opportunities associated with ESG issues,” she says.

“We are focused on long-term value generation, and this sometimes means we reduce our underwriting activities in a particular sector that we don’t consider sustainable, such as thermal coal, or that we stop investing in companies with poor ESG ratings.”

Swiss Re has also expanded in parametric products, an alternative option that can deliver fast payments based on pre-set triggers. The products, which have a rising profile in the northern Australian cyclone context, have application beyond wind damage and are continuing to evolve.

“By no means have we set what our offering is and locked it in there,” Ms Bell tells Insurance News. “We are continuing to learn, particularly as we talk to customers and understand new pressure points that they are facing with their businesses.”

She says the issues around covid have compounded a hardening market, with firms in the most affected sectors facing budget constraints. An “asset heavy to asset light” shift is taking place in the business world.

“It’s unsurprising that we are seeing more customers re-evaluating their retention strategies and reconsidering what risks they should transfer, retain or possibly self-fund by other means, and I think we have also observed an increase in risk awareness.

“Many companies were taken by surprise by the extent and the severity of disruption caused by the pandemic. It’s not an exposure that risk managers probably had at the top of their minds, and this has made corporations more alert about the potential gaps in their insurance programs.”

Businesses relying more on intangible assets are looking toward different approaches to complement traditional insurance programs, including tailored structured insurance solutions.

Interest in self-insurance arrangements, generally referred to as captives, has seen the insurer offer “virtual captives”, which keep the risk off the client’s balance sheet and leverage Swiss Re Group’s financial strength.

Fresh pair of eyes: Swiss Re Corporate Solutions chief Christine Bell

“We are seeing a rising interest in hard-market solutions, which are designed to provide longer-term certainty in this volatile market and optimise self-insured retentions,” Ms Bell says. “As needs are changing, we really have to think differently about what our customers need.” Longer-term, covid has highlighted social inflation as an emerging risk for the insurance industry, she says. Heightened societal expectations are being addressed via the legal system, resulting in larger legal costs, while the pandemic is also heightening the complexities of workplace safety risks, particularly in the most exposed sectors.

“I think everyone is doing their best to do a good job there and put the right measures in place and protect their people, but we don’t know what is to come,” Ms Bell says.

Remote and hybrid working and other changes to traditional office-based arrangements have also had implications for management styles.

Ms Bell says while senior positions come with common deliverables around strategy, achieving plans, driving change and shaping culture, how executives lead is critical to effectiveness. “Reflecting on what we have faced over the past two years shows that leadership styles need to adapt, and they need to adapt as our workforce adapts,” she says. “What I feel it has really shown is that leaders need to embrace flexibility and technology as key enablers of doing business.”

Trusting and empowering staff to make decisions around managing workloads to deliver on business priorities and individual goals also goes to challenges around attracting and retaining talent, she says.

“Having been in this industry a long time, in the early days it seemed like there was this endless pool of talent we could tap into,” she says.

But in the current competitive environment, the industry has to ensure it is clear about what it offers employees in terms of career paths, personal growth, and the sector’s diversity of opportunity.

“That is an area that has really changed over the past few years and is something that many businesses have been conscious of,” she says.

Amid other changes, insurers and policyholders have recently seen a “whirlwind of activity” in the broking community, with mergers, new entrants and significant movement of individuals between organisations.

“If I look at the short-term, this change within the intermediary space limits the potential for a softening of terms and conditions and pricing in the market, because brokers are really needing to establish themselves in a new status quo.”

At the same time there is increased tender activity, particularly in the large risk management account space where the insurer has a significant footprint.

“For an organisation like Swiss Re Corporate Solutions, our focus on innovation and alternative risk transfer and offerings to customers puts us in a pretty good situation where customers will be able to see what we can offer them,” she says. “From our perspective it creates a great environment.”

Ms Bell says the insurer has established a sustainable base that has set it up for the future.

“I can really see the opportunities to build on the momentum that has been achieved so far, to diversify our portfolio, grow and partner with our brokers and customers and go together on that journey forward.” 0

Hitting the fairways

Golf has attracted many converts as an ideal sport for a time of social distancing and lockdowns, and Christine Bell is among those to have discovered its advantages.

It’s a preoccupation she shares with many insurance people, although she had previously seen the sport as too time-consuming.

“I wasn’t actually a fan of golf,” she says. “I didn’t really know the rules, but I took up golf and learned to play, and now it’s something our family do together.”

Ms Bell now has a Golf Australia handicap, which she is aiming to improve, is playing competitions and has a new appreciation for all the sport has to offer.

“In the local competitions there are people in their 90s still playing golf. It is something you can do no matter what your age, and best of all we can do it as a family, and I really enjoy that.

“To have four and a half hours with a teenage son not on a screen is pretty unique time.”

Golf was a “permitted activity” during Sydney’s lockdowns, and Ms Bell found opportunities to sample courses on family holidays in NSW while state and international borders were closed.

She is also a long-time avid snow skier, enjoying visits to Northern Hemisphere slopes during Australian summers. She now has some additional ideas for future international travels.

“I typically in the past researched ski fields around the world and that consumed my interest. Now I have funnily enough started to look at the world’s great golf courses!”