Latest / Breaking the ICE / Episode 2 - Market Stats, Emerging Risk and AI's Boomerang Effect

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Episode 2 - Market Stats, Emerging Risk and AI's Boomerang Effect · Breaking the ICE

0:08
SPEAKER_00: Hello and welcome back to the Breaking the Ice podcast.
0:13
SPEAKER_00: This is episode two.
0:16
SPEAKER_00: I am one of the hosts, Elliot Draga, uh joined by my two esteemed co-hosts here, Lloyd Overton and Mark Colonese.
0:25
SPEAKER_00: Lloyd Mark, how are you guys doing today?
0:27
SPEAKER_00: All good, Zodiac.
0:28
SPEAKER_00: How are you?
0:30
SPEAKER_00: Yeah, pretty good.
0:31
SPEAKER_00: Pretty good.
0:31
SPEAKER_00: We have uh your heat wave has crossed the Atlantic.
0:35
SPEAKER_00: Uh so you're welcome.
0:37
SPEAKER_00: Yeah, thank you.
0:38
SPEAKER_00: Yeah, yeah.
0:39
SPEAKER_00: Well, but I mean, we invested in air conditioners over here and in infrastructure to keep us cool.
0:47
SPEAKER_00: So uh we may be contributing to the problem, but uh my house is cool, so I'm not uh I'm not I'm not sweating.
0:55
SPEAKER_00: As long as you're alright.
0:56
SPEAKER_00: How are you guys doing?
0:57
SPEAKER_02: Yeah.
0:59
SPEAKER_02: So yeah, I mean, definitely a lot cooler this week.
1:02
SPEAKER_02: Um, thankfully, I did invest in a portable air conditioning unit, which I think I mentioned to you guys last week.
1:06
SPEAKER_02: So uh other than the fact we're all sleeping in one room for one night uh for two nights, um we were all very cold, in fact.
1:13
SPEAKER_02: So so much so that I had to turn the air conditioning down.
1:16
SPEAKER_02: So yeah, just to uh to wind people up even more that might be watching.
1:19
SPEAKER_00: Yeah, I mean, Lloyd, I know you have two teenage boys, so that sounds like an absolute nightmare.
1:24
SPEAKER_00: Uh far worse than the heat wave.
1:26
SPEAKER_00: Without a doubt.
1:28
SPEAKER_00: Without a doubt.
1:28
SPEAKER_02: It's just the the challenge I've got now is that the uh the youngest one now seems to think that uh the front room downstairs is a new bedroom and and he seems to have moved in there permanently.
1:37
SPEAKER_02: So I've got to try and uh encourage him back up to his bedroom.
1:40
SPEAKER_02: So were you all camping in the front room?
1:43
SPEAKER_02: We was, except for the dog.
1:45
SPEAKER_02: He he didn't get an invite, unfortunately.
1:46
SPEAKER_02: He had to uh suffer it somewhat in the hallway.
1:48
SPEAKER_02: But uh yeah, we were we were all bunkered down in there for a few days.
1:52
SPEAKER_00: Lloyd, if you just put some some dirty dishes or some uh homework in that room, you'll chase him out.
2:00
SPEAKER_00: That's a good point.
2:01
SPEAKER_00: Or a lock on the door.
2:03
SPEAKER_00: Yeah, yeah.
2:04
SPEAKER_00: Lloyd, I noticed your you've got your soccer uh sorry, your football uh jersey on.
2:10
SPEAKER_00: Uh at time of recording, we're we're about, I don't know, 90 minutes from kickoff against the Democratic Republic of Congo.
2:18
SPEAKER_02: Yeah, exactly that.
2:19
SPEAKER_02: 90 minutes from the uh the last 16, I hope.
2:22
SPEAKER_02: Um let's hope they can be a bit more convincing in the first half.
2:27
SPEAKER_02: So I've still got some uh fingernails left in the second half because uh it's definitely going to be a bit more stressful now that we're in the knockout stages.
2:34
SPEAKER_02: But uh I mean they've got the quality, they've got the players, they just need to kind of execute on the day.
2:39
SPEAKER_02: So hopefully now that the the kind of um the stakes are a bit higher, they'll um they'll kind of pull their weight and push a bit harder and and definitely be a bit more uh a bit more dynamic coming forward in that final third.
2:50
SPEAKER_02: That's the plan.
2:52
SPEAKER_01: Do I have to announce the uh squad, yeah?
2:55
SPEAKER_02: It's a good point actually.
2:56
SPEAKER_02: I haven't actually looked, so I would assume that it's probably in the next half an hour.
3:05
SPEAKER_01: Any surprises?
3:08
SPEAKER_01: Just king Spencer Ryback.
3:15
SPEAKER_00: I I say this as if I know who any of these guys are.
3:19
SPEAKER_00: I listen, yeah, I I would I would hope that you join the esteemed football nation of Canada in in the next round.
3:28
SPEAKER_00: We had uh Morocco okay, we're making national uh I'm wearing some Canada gears.
3:36
SPEAKER_00: Today, actually, uh again, day of recording July 1st, uh, is Canada Day.
3:41
SPEAKER_00: It's it's our nation's birthday.
3:43
SPEAKER_00: Yes, so it's a it's a national holiday, and I chose to spend it with you two chaps.
3:48
SPEAKER_00: Uh you're very welcome.
3:51
SPEAKER_00: Absolutely not.
3:52
SPEAKER_00: Uh no, no, no, no chance of that.
3:56
SPEAKER_01: Um annoyed, it's cheesy chips if you didn't know.
4:02
SPEAKER_01: National dish.
4:03
SPEAKER_02: You should never turn down cheesy chips, Mark.
4:06
SPEAKER_02: Oh, gosh.
4:07
SPEAKER_02: You've got to layer the cheese in though, just on top is not good enough.
4:11
SPEAKER_00: Yeah, I don't yeah, yeah, yeah.
4:12
SPEAKER_00: But I don't know how that became like a national thing within Canada.
4:16
SPEAKER_01: Um Well, you're only a young country, I mean you got plenty of time to get it right, you know.
4:22
SPEAKER_01: That's that's not bad, not bad for a first attempt, I would say.
4:27
SPEAKER_00: 1867, so I think we're we're 159 today.
4:31
SPEAKER_00: Look pretty good for 159, if my mental math is correct.
4:37
SPEAKER_02: Agreed.
4:39
SPEAKER_00: What else is new?
4:39
SPEAKER_00: What's going on with you guys?
4:42
SPEAKER_01: Um, well, I'm busy doing the pet thing.
4:47
SPEAKER_01: Lots of activity in that area.
4:50
SPEAKER_01: Um some interest from the other side of the planet, which is interesting.
4:55
SPEAKER_01: So we'll see how that plans out.
4:57
SPEAKER_01: Um yes, that's that's me.
5:00
SPEAKER_02: Yeah.
5:00
SPEAKER_02: And I am busy with another RFP.
5:04
SPEAKER_02: I should be kind of head of RFPs, I think, at the moment, because I've kind of bounced from one to the other to the other.
5:10
SPEAKER_02: Um, so yeah, I mean, definitely a pro by now, without a doubt, but it's uh Jesus, uh, it's time consuming.
5:16
SPEAKER_02: And it just, you know, you guys are three worst, I know, but yeah, the three worst letters in sales, right?
5:22
SPEAKER_00: RFP.
5:24
SPEAKER_00: Absolutely horrendous.
5:26
SPEAKER_00: Actually, maybe RFI is worse.
5:28
SPEAKER_00: RFI is worse.
5:29
SPEAKER_00: Yeah, RFI is worse.
5:30
SPEAKER_00: Because it's it's only slightly less work for uh significantly less probability.
5:37
SPEAKER_02: Yeah, exactly.
5:38
SPEAKER_02: Definitely, definitely.
5:39
SPEAKER_02: I mean, in fairness, this one's pretty well, it's pretty well laid out.
5:41
SPEAKER_02: So they've they've put some some firm dates.
5:44
SPEAKER_02: It's it is a good as far as RFPs goes, it's a good one, actually.
5:47
SPEAKER_02: I'm I'm uh I'm getting stuck into it, and so far, so good.
5:49
SPEAKER_02: We're uh we're looking like we're uh we're kind of ticking planet boxes.
5:53
SPEAKER_02: Good.
5:53
SPEAKER_02: Good, good, good, good, good.
5:55
SPEAKER_00: How about you?
5:55
SPEAKER_00: Um what's new with me, um, other than hoping that there's no uh screaming kids on the other side of this wall because they're both home and it's summer holidays now.
6:06
SPEAKER_00: Um today, July 1st, is Canada it's Canada's birthday, but it's also very excitingly as a North American, uh, it is when all of the free agency happens in the the National Hockey League and the National Basketball Association.
6:23
SPEAKER_00: And so where I live, Toronto, we have teams and poor bad teams, but we have teams in both of those leagues.
6:30
SPEAKER_00: And so what happens is players sign contracts, those contracts expire, and then they become a free agent and they can sign anywhere they want.
6:38
SPEAKER_00: And so it's uh it's an exciting day as a sports fan, um, seeing where all the all the these uh free agents end up on new rosters because there's usually a ton of activity on day one, and then it all kind of peters off.
6:51
SPEAKER_00: Yeah.
6:52
SPEAKER_00: So I will be eagerly uh eagerly watching that while I also watch England and uh Congo play.
6:59
SPEAKER_02: I noticed that as well actually, because we're um we're going on a we're getting into holiday season in the insurance industry.
7:04
SPEAKER_02: Everyone goes away at the same time, or a lot of people do with kids certainly in the school holidays.
7:09
SPEAKER_02: And uh and we're going to uh to the US this year.
7:11
SPEAKER_02: And I was kind of like, right, while we're there, let's see if we can pick uh an American sport, baseball, basketball, just absolutely anything.
7:19
SPEAKER_02: But it's kind of like off season for everything.
7:21
SPEAKER_02: So um no joy.
7:24
SPEAKER_00: Baseball season is is on while you're there.
7:26
SPEAKER_00: It is.
7:27
SPEAKER_00: Uh but where you're going, I don't think you want to watch the baseball team.
7:31
SPEAKER_00: So uh I you're you're better off just kind of cruising the Pacific Coast highway and uh yeah, enjoying it, maybe go surfing or play some golf.
7:42
SPEAKER_00: Uh yeah.
7:43
SPEAKER_02: Driving past Pebble Beach, maybe I'll nip in there for a few holes.
7:46
SPEAKER_00: Yeah.
7:47
unknown: Yeah, yeah.
7:49
SPEAKER_00: Do they do they sell you uh a per hole rate instead of uh a per round rate?
7:53
SPEAKER_00: Because I think the the per round rate's steep.
7:55
SPEAKER_02: Oh my god.
7:56
SPEAKER_02: I mean, yeah, I mean I've actually been in there once before um and been and had a look at the 18th hole, and yeah, I mean God knows how much it costs.
8:02
SPEAKER_02: But it's quite an open course, actually.
8:04
SPEAKER_02: You can go in and have a wander around, you can go in the pro shop, you can go in the bar and stuff.
8:08
SPEAKER_02: But yeah, I think I'll I mean I will look, but yeah, the the wife's definitely not gonna want to be uh playing any holes, let alone one hole at Pebble Beach, as much as it's a nice place to go visit.
8:19
SPEAKER_00: Did ever tell you my story about uh I was in Arizona once, um and I was in Scottsdale, Arizona, where there's a pretty famous tournament that's held, the the Waste Management Open, which is the one where all the, you know, they set up the crazy stanchions.
8:37
SPEAKER_00: Yeah, the stadium hole, and they, you know, everybody throws their beer bottles on the course and stuff.
8:42
SPEAKER_00: It's mayhem, right?
8:43
SPEAKER_00: Um, but it's a beautiful course, and and Scottsdale's a nice city.
8:47
SPEAKER_00: So I was there, and uh my dad was there with me.
8:50
SPEAKER_00: And so we decided to play.
8:52
SPEAKER_00: It was about a month after the tournament, we decided to play uh at the stadium course.
8:57
SPEAKER_00: And the way the course is laid out, you drive up this uh road, and then there's the stadium course on one side, and then there is like a private members-only course on the other side.
9:08
SPEAKER_00: And a couple of days before we were meant to tee off, some some guy crashed his private plane onto the other course.
9:18
SPEAKER_00: So horrible.
9:20
SPEAKER_00: Obviously, you know, feel terrible about the situation for that that guy.
9:25
SPEAKER_00: But I had to call and ask if we still had our tea time.
9:29
SPEAKER_00: And so I called and I was like, you know, um, I don't know how to ask you this question, feel really bad, but like, is the course open?
9:38
SPEAKER_00: And and the lady was so wonderful working there, she's like, you have no idea how many people have called.
9:43
SPEAKER_00: Don't worry about it.
9:44
SPEAKER_00: Yes, we're still open.
9:45
SPEAKER_00: So we played the course, beautiful course.
9:47
SPEAKER_00: But when you get to the 16th hole, which is where they set up the stadium, it because it was a month after the tournament was played, they had obviously ripped all of that out and had just laid sod down.
9:59
SPEAKER_00: And it was the most underwhelming, because with all without all of that stuff around, it's just like, I don't know, 140-yard par three.
10:06
SPEAKER_00: Like nothing, nothing exciting about it.
10:08
SPEAKER_00: It I think they put that stuff up on that hole because it's otherwise such an unimpressive hole.
10:14
SPEAKER_00: Um, but yeah, great course.
10:16
SPEAKER_02: You saying that, I just had a picture in my head that you was actually gonna say that it was like a scene from Happy Gilmore and you was, you know, needing to kind of ricochet it off of something to get it on the green and go around the hazard.
10:27
SPEAKER_02: But yeah, thankfully.
10:28
SPEAKER_00: Oh yeah, well, I definitely did hit every cactus and tree on the course.
10:32
SPEAKER_00: Like that's if you've ever played golf with me, right?
10:35
SPEAKER_00: I mean, I can't keep the ball straight, but um uh unintentionally for sure.
10:41
SPEAKER_00: So listen, guys, I thought today we could just uh talk about, you know, what's new in the news.
10:47
SPEAKER_00: Uh picked a few articles to scan through.
10:50
SPEAKER_00: Um yeah, just uh an open discussion.
10:53
SPEAKER_00: I I read um there was, I think it was Alliance that published their global uh market stats for the insurance market recently.
11:05
SPEAKER_00: Um and I think overall the the highlight from from what I was reading was that premiums rose about 7% in 2025 overall.
11:16
SPEAKER_00: Uh and then they they sort of go into the distribution.
11:19
SPEAKER_00: Um they said the life insurance market globally is the biggest at about 2.8 trillion or 2.8 Elon Musk's, as I now uh denominate currency.
11:31
SPEAKER_00: He's come down.
11:31
SPEAKER_00: Yeah, yeah.
11:32
SPEAKER_00: Oh, he's come down, eh?
11:33
SPEAKER_00: Post IPO, the the the crash has happened.
11:36
SPEAKER_00: Well, I'll buy on the dip.
11:40
SPEAKER_00: Yeah, I'll please.
11:42
SPEAKER_00: Actually, funny, funny on on that, I was listening to a podcast this morning, and the the guy was he was just he was trying to quantify a trillion and he was saying, um if you if you denominate time it or if you denominate sort of uh you know like million, billion, and trillion in you can't even do it in days now, because if you do it in days, a trillion is like 3.2 million years or something.
12:10
SPEAKER_00: So then if you do it in seconds, a million seconds is like a week and a half, a billion seconds is 32 years, and a trillion seconds is 32,000 years.
12:20
SPEAKER_00: Oh my god.
12:22
SPEAKER_00: Uh like just to put the in scale, right?
12:25
SPEAKER_00: Um so yeah, anyways.
12:27
SPEAKER_00: So 2.8 trillion.
12:29
SPEAKER_02: Maybe that's the kind of you know average age on the planet he arrives from and he's that much money.
12:37
SPEAKER_00: Yeah, he's just hitting his stride now, eh?
12:40
SPEAKER_00: Exactly.
12:40
SPEAKER_00: Just he's in his prime years.
12:43
SPEAKER_00: Yeah, yeah.
12:45
SPEAKER_00: It's it's gonna be it's gonna be crazy, you know, 400 episodes from now when he's he's a guest, and and I'm sure he's he'll have listened to every one of these.
12:53
SPEAKER_00: And um, yeah.
12:55
SPEAKER_00: Uh anyways, uh so yeah, life insurance 2.8, um uh PC was 2.3, and health was 1.7 trillion, just to give an idea of the the relative distribution of the three.
13:08
SPEAKER_00: Um and then in terms of growth stats for 2025, um P and C had only grown 3.8%, which is just a little bit above inflation.
13:20
SPEAKER_00: Um I think life was the uh the sort of middle growth one at around 7%.
13:28
SPEAKER_00: And then um I think global health premiums grew about 10%.
13:32
SPEAKER_00: So again, um, you know, 3.8 for PC, 7% for life, and and about 10% for health.
13:40
SPEAKER_00: Um, just curious to get your your guys' initial take on that.
13:43
SPEAKER_00: There were some other interesting stats in the article, but uh yeah, what are your thoughts?
13:49
SPEAKER_02: Yeah, I mean it it sounds good, right?
13:51
SPEAKER_02: Um it's booming.
13:53
SPEAKER_02: Um everybody's rich, champagne all rounds.
13:57
SPEAKER_02: I I guess you know the the the challenge with all of this is that it's it's probably not it's probably not all just growth in the in the positive sense.
14:04
SPEAKER_02: I think you know when you see premiums going up, it doesn't always mean that everyone's in the insurance industry is having a having a great time.
14:11
SPEAKER_02: I think you know you guys will know just as much as I do.
14:13
SPEAKER_02: It's claims are becoming more expensive.
14:17
SPEAKER_02: Uh I'm pretty sure um Iran and Ukraine and inflation and all the things linked to it are probably having a bit of a an impact as well.
14:25
SPEAKER_02: And and again, you know, is it is it weather events getting worse?
14:28
SPEAKER_02: I mean, you know, last week that was all I heard on the on the on the news in relation to the kind of heat wave we were seeing in the UK.
14:34
SPEAKER_02: Um and then of course, potentially reinsurance.
14:38
SPEAKER_02: So yeah, I mean I think the the market's growing, but is it is it because there's more opportunity or is it because the world's become more expensive and more risky?
14:46
SPEAKER_02: That's that's probably the the point I'd make.
14:48
SPEAKER_02: How about you?
14:49
SPEAKER_01: I I completely agree.
14:50
SPEAKER_01: I mean, putting my pet detective hat on.
14:53
SPEAKER_01: I just googled it.
14:54
SPEAKER_01: Um vet vet fee cost inflation in the past uh five years, have a guess.
15:05
SPEAKER_01: In the past five years?
15:06
SPEAKER_01: Past five years.
15:08
SPEAKER_00: 25%.
15:10
SPEAKER_00: No, more I have no idea.
15:15
SPEAKER_01: 50%, 50%, 50%, 50%.
15:18
SPEAKER_01: And and that's in a market where you can't just turn up tomorrow and change your rates.
15:24
SPEAKER_01: You have to wear that cost.
15:26
SPEAKER_01: Um and if you don't see that coming, it's gonna hit you in the face like a sledgehammer.
15:29
SPEAKER_01: So quite a lot of companies have been burned quite quite badly and are still kind of suffering.
15:34
SPEAKER_01: I think I saw something about Lemonade, only just got their rates reapproved in California, and I was thinking, oh my god, you know, they've been rinsed for however long.
15:43
SPEAKER_01: So it's incredible.
15:44
SPEAKER_01: Yeah, so I mean, I think there's certainly on the in the pet space, and when I look at quotes in America, it's expensive, but vet care is is really expensive and everyone's kind of playing catch up.
15:59
SPEAKER_02: I think the challenge you see with this kind of stuff, right?
16:02
SPEAKER_02: You know, you we're hearing about it in in the supermarket, and you know, uh the your food shop costs more because it's you know costs more to get it there, and all of that kind of good stuff.
16:10
SPEAKER_02: And I and I think, you know, when you see these kind of sensationalized numbers posted by big insurance companies, especially in the UK, when customers think, God, you know, what do I get for my insurance?
16:18
SPEAKER_02: You know, they take a big premium, they're they're making God knows how much money, they're all having a whale of a time.
16:23
SPEAKER_02: But you know, it's they've charged more premium, but you know, everything else costs more.
16:27
SPEAKER_02: Claims are bigger, customers are under pressure, everyone still wants better service for less money.
16:31
SPEAKER_02: It's it's you know, all of the same challenges are happening in the insurance industry, I would say, as they are everywhere else.
16:38
SPEAKER_02: So actually, you know, it's it's kind of it's great to put that out there, but it'd be great to put some context around it sometimes, just so that you know, people that don't necessarily understand the market um can kind of see that you know we're we're all feeding it in in in all industries, right?
16:52
SPEAKER_02: Yeah.
16:53
SPEAKER_00: Yeah, I I I was I I I I thought it was interesting that you know P and C is typically a much more of a legislated um uh required product, right?
17:04
SPEAKER_00: If you want to drive a car, if you want to own a home own a home, if you want to um own a business, you have to have some insurance coverage, whereas life and health are more sort of discretionary.
17:15
SPEAKER_00: So I I found it interesting that the the growth stats were lower in P and C because you would think that, or the premium, right?
17:24
SPEAKER_00: We're talking about, you know, sort of dollar of dollar premium.
17:27
SPEAKER_00: Um yeah, I I I I don't know.
17:31
SPEAKER_00: I mean, maybe there's just more opportunity for growth in the life and health markets because there's more market capture, uh more opportunity, you know, less of an insured population.
17:42
SPEAKER_00: Um, again, that that glosses over the the nuance and all different regions and and all different sort of subsegments of of each each of those lines.
17:51
SPEAKER_00: But um I do think that you know, health costs.
17:57
SPEAKER_00: I think there was a stat later in the article saying that the US represents 70% of global health premiums.
18:02
SPEAKER_00: So of that 1.7 trillion, you know, what's yeah, what's 70% over over a trillion of that, right?
18:09
SPEAKER_00: Is just the US.
18:10
SPEAKER_00: So if there's also health cost inflation or the input cost, uh the claims cost, you know, is inflating there as well, that's gonna drive your your premium growth, right?
18:21
SPEAKER_00: Um, or a large chunk of the premium growth.
18:23
SPEAKER_00: So um, yeah, just it definitely interesting stats.
18:26
SPEAKER_00: I think it does uh to your point, Lloyd, it it helps to put things in perspective.
18:30
SPEAKER_00: There was an interesting change talking about consumer friendliness of insurance, there was an interesting change uh on auto insurance or moto and motor insurance um in Ontario, the province that I live in in Canada, where they have just passed a bill to strip out a ton of previously mandatory coverages.
18:54
SPEAKER_00: So when you used to buy auto insurance in Ontario, you would have to, I mean, you would just pay like one sort of comprehensive premium and included a bunch of add-ons, um, you know, income protection, critical illness uh benefits, things like that.
19:11
SPEAKER_00: And so the bill is is allowing those to be optional and effectively, you know, it's it's gonna allow um individuals to strip those out.
19:19
SPEAKER_00: I think it'll be interesting to see what insurers' experience is going forward and and whether like what happens with those premiums going forward?
19:29
SPEAKER_00: Do the do the optionals um, you know, can they stand on their own?
19:34
SPEAKER_00: Do they have legs on their own?
19:36
SPEAKER_00: Um does it make the core product you know more expensive in the in the future going uh or going forward as well?
19:43
SPEAKER_00: Uh but I I I do think that we're seeing consumer pressure um to change some of these products as well.
19:50
SPEAKER_02: I think the biggest thing for me, and you know, we we're talking to these guys all the time, which is great.
19:54
SPEAKER_02: So we get the inside track, but you know, it's it's great, it's a great headline number.
19:58
SPEAKER_02: I hope there's lots of positives in that headline number for sure.
20:01
SPEAKER_02: Um, but you know, there's still so much more opportunity for these guys.
20:04
SPEAKER_02: It could be it could be even better.
20:06
SPEAKER_02: You know, we know that you know businesses need to move quicker, they need access to better data.
20:11
SPEAKER_02: We know the AI story is a big thing right now, and and it's great that ISETEC are doing lots in that space.
20:17
SPEAKER_02: Um launching products quicker, reacting to new opportunities, uh taking cost out through automation.
20:23
SPEAKER_02: So actually, you know, if that's the number today, there's still so much scope for it to be even better, which uh which excites me even more.
20:32
SPEAKER_00: Yeah, yeah, I I I agree.
20:34
SPEAKER_00: I mean, even I mean that's that's your wheelhouse, right, Lloyd, is in the P and C space.
20:39
SPEAKER_00: So um to hear that there's even greater opportunity within an already sort of heavily saturated market is exciting, uh, I think for anybody who's in or or adjacent to the industry.
20:53
SPEAKER_00: Yeah.
20:55
SPEAKER_00: What do you think about emerging risks?
20:58
SPEAKER_00: I mean, Mark, you mentioned sort of, you know, you touched on climate a little bit, right?
21:02
SPEAKER_00: Um I think the the new word, it might be Webster's word of 2026 is polycrisis, this concept of just this crazy confluence of events, all of these uh seemingly disruptive things happening in parallel.
21:17
SPEAKER_00: Um what's your thought on yeah, the emerging world, whether it's cyber, whether it's climate, how do you how do you ensure for it?
21:26
SPEAKER_00: How do you strip out what is attributed to one crisis factor versus another?
21:32
SPEAKER_01: Yeah, I don't really uh I don't really know, to be honest.
21:35
SPEAKER_01: I mean, obviously climate is huge.
21:38
SPEAKER_01: Um and, you know, I guess parts of parts of the the eastern seaboard in uh in the States is almost becoming uninsurable.
21:49
SPEAKER_01: Um so it'll be interesting to see how that plays out.
21:52
SPEAKER_01: Um I mean, actually, you know, just thinking about it here, I mean I I I don't know what it will mean for the Sector, but like you know, if we're continuing to go on holiday during massive heat bombs, you know, that is going to have an impact on claims.
22:09
SPEAKER_01: So I I think that's kind of what I think about.
22:13
SPEAKER_01: Um, I mean, cyber's also obviously a key risk, and with AI models that can unpick your security um within a few hours, um, you know, how we handle that is gonna be key.
22:26
SPEAKER_00: Um Yeah, but travel's travel's sort of a funny use case for for this discussion, right?
22:32
SPEAKER_00: Because uh there's a lot of parametric solutions in travel, and a lot of those parametric solutions uh, you know, they they automatically settle a claim when a flight gets canceled, right?
22:45
SPEAKER_00: Why are flights getting canceled on you know on an increased basis now, you've got fuel surcharge that could now become a parametric cause, right?
22:58
SPEAKER_00: Or or a parametric event that that triggers uh how does it sorry, how does a fuel surcharge work?
23:04
SPEAKER_00: Well, if if fuel goes above, let's say$200 a barrel, right?
23:08
SPEAKER_00: And then the input cost for the airline to actually fly that plane, if if airlines are losing money on flights, they're gonna stop flying flights, right?
23:15
SPEAKER_00: And and that then triggers the the the uh cancellation claim.
23:19
SPEAKER_00: So I think you know travel so uniquely positioned because it's it it it's subject to a lot of these uh external geopolitical external factors that are happening, right?
23:34
SPEAKER_00: Whether it's uh conflict in a region that immediately voids somebody's insurance coverage, um, whether it is uh yeah, like I said, I mean the input cost of fuel uh or the the sort of margin pressure the airlines are facing.
23:51
SPEAKER_00: Um it's it's there's a tremendous amount of instability being a uh uh a travel insurer these days.
24:01
SPEAKER_01: So premiums are premiums going up now, do you think, uh because of what's gone in Iraq?
24:07
SPEAKER_00: Iran, Iran Yeah, I I I think so.
24:12
SPEAKER_00: I mean I I you know it's not I I think I think global travel premiums are going up more based on US uh healthcare cost inflation.
24:21
SPEAKER_00: Uh you know, US is is a massive travel destination.
24:24
SPEAKER_00: It's a massive global travel destination.
24:26
SPEAKER_00: It's a uh you know, it's quite a popular claims destination for travelers as well, right?
24:32
SPEAKER_00: People go to the US and get sick and end up in hospital.
24:35
SPEAKER_00: Uh so I think that that's more driving um, you know, premium growth for certainly for regions that have a high population of travelers into the US.
24:46
SPEAKER_00: I I don't know, you know, with what's happening in the Middle East, I don't know how many, I don't know how big the travel and tourism sector was there prior to um the conflict.
24:56
SPEAKER_00: So I don't know that that's uh a huge impact.
24:59
SPEAKER_00: Um but obviously airlines are canceling flights, airlines are having to reroute, which is making more expensive flights.
25:07
SPEAKER_00: Obviously, like I said, you know, their input costs are higher because uh oil prices are higher.
25:12
SPEAKER_00: Um so that's impacting on the cancellation side.
25:16
SPEAKER_00: Um but I I think it's probably the health cost inflation that would be driving premiums up more than that.
25:21
SPEAKER_02: Make sure you got your travel insurance Lloyd for the states.
25:25
SPEAKER_02: Yeah.
25:25
SPEAKER_02: I have I have got it with uh with an insurer that we were just talking about, so I'm sure they'll look after me really well.
25:32
SPEAKER_02: Um which is good.
25:33
SPEAKER_02: Which is good.
25:34
SPEAKER_02: I think the the emerging risk funds an interesting one, isn't it?
25:37
SPEAKER_02: I I used to kind of think about this a little bit when working at Lloyd's, you know, you got to see some quite niche type um products working in a Lloyd's market, and you know, cyber was the talk of the day, but you know, there's there's so many now.
25:49
SPEAKER_02: It's like cyber, uh climate, geo geopolitical kind of events and things like that.
25:56
SPEAKER_02: And actually, uh almost a lot of these things kind of they almost merge into one, so they're not really thinking about one thing anymore.
26:02
SPEAKER_02: They're all kind of interconnected, so it's kind of interesting to see where that goes.
26:05
SPEAKER_02: I think one for me that I'd kind of I think is going to become more and more um taught about, I think, is is probably AI.
26:14
SPEAKER_02: Um, you know, I'm I'm all in on AI, you know, definitely, you know, I'm I'm I'm out there selling the the things that we're kind of developing internally and and and it's it's doing wonders from from for me personally, from a work perspective.
26:27
SPEAKER_02: I think it's great, but you know, there's also some AI out there that's not improving workflows, that's not helping claims be settled quicker.
26:34
SPEAKER_02: There's you know, there's AI out there that's creating fraudulent pictures, there's AI out there that's creating misinformation.
26:40
SPEAKER_02: So, you know, it's you know, definitely there's definitely some concern there around kind of like decision-making bias and uh and some of that kind of things that you know people are already asking us questions about.
26:51
SPEAKER_02: So actually, does that then become a product in its own right?
26:53
SPEAKER_02: Um, you know, also you think about it.
26:56
SPEAKER_01: You think about companies adopting AI and the AI getting the answer wrong and people not realising straight away, and then suddenly you're hit with a liability claim because you've done AI perhaps not as well as you should have done.
27:11
SPEAKER_01: So I think that that'll be an interesting.
27:14
SPEAKER_02: And when does when does someone deploy some kind of AI that then creates a cyber risk and it leaks into, you know, you can see where these kind of emerging risks and and potentially you know um new product lines could could effectively almost be like one type of combined offering, potentially.
27:29
SPEAKER_00: Yeah, you could yeah.
27:32
SPEAKER_00: I just read a headline that there's apparently now 1.7 billion people um or about 1.7 ELM, no, just kidding.
27:40
SPEAKER_00: Um there's about 1.7 billion people that are now using AI.
27:44
SPEAKER_00: Uh I think probably the majority of those are just AI bots that have self-replicated, um, because I don't think it's actually that many.
27:52
SPEAKER_00: But uh yeah, 1.7 billion people, and only 3% of those 1.7 billion pay for some sort of AI subscription, right?
28:02
SPEAKER_00: So a lot a lot of it is just, you know, to your point, Lloyd, it's it's people who are using a free account to to, you know, make stuff and they could be making bad things.
28:13
SPEAKER_00: They could be making, you know, falsified documents um under a sort of pseudonym account or whatever the case might be.
28:20
SPEAKER_00: So it is a it is a big risk.
28:23
SPEAKER_00: Um I think because it's been so quickly adopted, um, it's heartening to see regulators are much more um responsive to to the mass adoption of of AI and and try to craft regulation around it.
28:43
SPEAKER_00: Um, because I think it it was sort of, you know, the boat was missed to some extent with with e-commerce and was definitely missed with social media becoming more more pervasive.
28:55
SPEAKER_00: So it's it's it is heartening to see that they're they're getting more in front of it.
28:59
SPEAKER_00: Um I was reading the other day that um well a couple things.
29:04
SPEAKER_00: There's been this sort of boomerang effect around AI layoffs and hiring.
29:10
SPEAKER_00: So, you know, I think we've all read the headlines.
29:14
SPEAKER_00: There was, you know, sort of pretty big disruptions to the job market.
29:18
SPEAKER_00: Uh, and and I think that's you know been telegraphed in terms of you know one of the fallout effects of of mass AI adoption.
29:26
SPEAKER_00: But there's actually been this sort of tremendous boomerang effect.
29:30
SPEAKER_00: Um, and I think that just it goes with the maturity of the solution.
29:37
SPEAKER_00: And it's odd to talk about the maturity of something that's really only six, 12 months old.
29:43
SPEAKER_00: But, you know, as as it becomes more of a uh clear picture from a consumer landscape, you know, how people are going to be interacting with with these tools and services, um, I think the dust will settle from a business landscape as well.
29:58
SPEAKER_00: Uh, and there has been quite a big rebound in the job market.
30:01
SPEAKER_00: Um, so companies that had previously done sort of mass layoffs and attributed it to efficiencies are now rehiring a lot of folks back.
30:10
SPEAKER_00: Maybe those efficiencies were overstated.
30:13
SPEAKER_00: Uh, maybe they weren't indicative of of you know their entire operations.
30:17
SPEAKER_00: I don't know.
30:18
SPEAKER_00: But I I was interested to see that headline flash across as well.
30:24
SPEAKER_01: Yeah, it's interesting.
30:25
SPEAKER_01: I mean, I think there's a lot of uncertainty in the market in general.
30:30
SPEAKER_01: AI is just another factor that plays into it.
30:32
SPEAKER_01: And I think to a certain extent, organizations are waiting to see how how things will pan out.
30:40
SPEAKER_01: Um and maybe, you know, that you can you can't stop, you can't stop hiring forever.
30:46
SPEAKER_01: Um, and then you know, there's also you know, succession as well.
30:49
SPEAKER_01: You know, if you're not if you're not filling your workforce up from the bottom, then as people leave at the top, you know, who's coming through?
30:57
SPEAKER_01: You need to build that, you need to build that core competence.
31:00
SPEAKER_01: Um, so I think people have started to get a little bit well alive to that issue as well.
31:05
SPEAKER_02: Yeah.
31:06
SPEAKER_02: I think for me, just don't get carried away with it, right?
31:08
SPEAKER_02: You know, I mean, how awkward is it going back and trying to rehire someone that you've laid off because of AI.
31:14
SPEAKER_02: Um, you know, it's it's kind of like throwing away the instructions and building the IKEA wardrobe and then digging back through the trash to find the instructions because you get halfway through it and it's and you can't get it done.
31:28
SPEAKER_02: Uh these six screws for.
31:30
SPEAKER_02: Yeah, exactly that.
31:32
SPEAKER_02: I think it's you know, AI always I think for me, everything I've seen from an AI perspective in a demo, you kind of look at it and you think, wow, amazing, this is just gonna solve all my problems.
31:42
SPEAKER_02: But actually, you know, buy it, try it, bed it in, i incorporate it into what's already there, and then make decisions rather than kind of you know play with it for a couple of weeks and think, oh my god, right, great, I don't need these kind of 20 people.
31:54
SPEAKER_02: I think that's really sad, you know, going down that kind of kind of path.
31:57
SPEAKER_02: I think, you know, definitely I get it.
31:58
SPEAKER_02: You know, there's things that that the machine can do that people don't need to do, and there's efficiencies to be made, and there's ways of deploying people into into roles doing things that you absolutely need a human for.
32:08
SPEAKER_02: But I think, you know, just live with it for a bit.
32:10
SPEAKER_02: Don't don't make any rash decisions.
32:13
SPEAKER_00: Yeah, I think I think the the speed and the power of it um is is disruptive.
32:21
SPEAKER_00: I I think I think that you know the speed at which you can do things and and the power insofar as w the breadth of what you can actually do with a lot of the tools is disruptive.
32:32
SPEAKER_00: It's changing the way people are working.
32:34
SPEAKER_00: Lloyd, you said it yourself, right?
32:35
SPEAKER_00: It's it's changed the way that you're working on a day-to-day basis.
32:37
SPEAKER_00: But it doesn't remove people from the equation.
32:40
SPEAKER_00: And I think that was maybe where you know we start to get ahead of ourselves was was to say that, well, it's it it is going to sort of automate the future, it's gonna change the way things are done and things will be automated, but you know, I think people are still a critical component uh to that, uh at least again in the here and now, right?
32:59
SPEAKER_00: Um, you know, um yeah, I think I think we're still early in the adoption life cycle.
33:08
SPEAKER_00: Um and and hopefully with again, with more regulatory involvement, uh, we're not gonna go off the rails with it and um you know just all uh forget how to read and write and and and do math.
33:20
SPEAKER_00: Uh because we can ask uh chat GPT.
33:24
SPEAKER_02: If I was throwing one thing into the mix, that kind of worries me.
33:27
SPEAKER_02: Uh it really worries me, actually.
33:28
SPEAKER_02: And I think I was mentioning it to you guys before, but it's the amount of time I see my kids with the Snapchat AI assistant kind of like doing the rounds on their homework.
33:38
SPEAKER_02: And I'm like, you know, I all of a sudden I'm kind of wow, my kids are really good at homework.
33:43
SPEAKER_02: They just come in and get it on.
33:44
SPEAKER_02: But the amount of times I see them using it, I'm like, guys, you're gonna have to try and learn this stuff as well, right?
33:48
SPEAKER_02: You can't just get AI to do it for you.
33:50
SPEAKER_01: Oh, gee, the other thing that really winds me up, and apologies in advance if I offend anyone, but there's a lot of AI slop on LinkedIn.
33:59
SPEAKER_01: Yeah, yeah.
34:00
SPEAKER_01: Some someone's just posted some stuff and then they've pressed a pressed a button and they've written six paragraphs, and it's just, oh, really?
34:09
SPEAKER_01: You didn't know that.
34:10
SPEAKER_00: But I'm I'm a firm believer in the cyclical nature of things, and and I think you know, it'll be bombarded.
34:17
SPEAKER_00: Yeah, we'll be bombarded with this stuff, and so then what will actually shine is what's authentic and what's real.
34:24
SPEAKER_00: I just I worry uh again, I'm biased.
34:26
SPEAKER_00: I have young kids, so I'm just worried that to your point, Lloyd, the foundation isn't getting established.
34:32
SPEAKER_00: Like we're all sitting here as you know, middle-aged individuals that have learned all of these things and can critically think and critically reason.
34:41
SPEAKER_00: You know, we got the opportunity to do that without this super tool that that you know could have could have bypassed those processes, right?
34:50
SPEAKER_00: So uh, you know, I I I do think that's uh again why I'm heartened that regulators getting more involved, because uh it will hopefully, you know, set age restrictions on these things.
35:01
SPEAKER_00: It will hopefully influence the education sector.
35:04
SPEAKER_00: Um, you know, I you know, I again I I I yeah, I'll I'll I'll reserve my comments on social media and and what a catastrophe that's been for another episode.
35:18
SPEAKER_00: Um or or maybe I'll just I'll just uh you know I'll I'll go off on a on a tangent on my own and and surprise you guys with a lot of these.
35:27
SPEAKER_02: There's plenty going on in that space in the UK as well where the kids are concerned.
35:30
SPEAKER_02: So yeah, we can definitely talk about that one.
35:33
SPEAKER_00: Yeah, yeah, yeah.
35:34
SPEAKER_00: Yeah.
35:35
SPEAKER_00: Um yeah, but it but again, I mean, I think just to to sort of close this one off, uh it still is it still is dominating the uh the news cycle.
35:46
SPEAKER_00: Um you know, it's still dominating the headlines from a business standpoint.
35:51
SPEAKER_00: But I've seen I don't know about you guys, but sort of maybe we can just leave on this last point.
35:56
SPEAKER_00: I've seen a tonal shift as far as you know the communication around AI, where it's much less sort of aspirational and um much less aspirational and much more grounded, realistic, focused on automation, focused on real outcomes and and sort of demystifying all of the magic that it you know was dominating the headlines from six months ago.
36:25
SPEAKER_00: I don't know if you've experienced the same thing.
36:27
SPEAKER_02: Yeah, I'd I'd I'd go with that actually.
36:29
SPEAKER_02: I think people are being a bit more focused and and more kind of you know laser guided in terms of I want it to do this thing or I want it to do this five things rather than it can do everything.
36:39
SPEAKER_02: And I think you know it comes back to that point before.
36:42
SPEAKER_02: Put it in, get it doing a couple of things, live with it, and then kind of evolve it from there.
36:47
SPEAKER_01: Yeah, we're just we've just signed up a large US pet insurer to use AI on the web journey.
36:53
SPEAKER_01: Uh, and it's a very, very focused thing that they're trying to do.
36:55
SPEAKER_01: It's completely measurable, it's we're gonna do it in a short time frame, you know.
37:00
SPEAKER_01: So we're getting a little bit more kind of laser focused on on what AI is gonna do.
37:05
SPEAKER_01: Um, so it it's not this nibbless thing anymore.
37:08
SPEAKER_01: It's is it working for us or is it not?
37:10
SPEAKER_01: So it'll be interesting to see how that goes.
37:11
SPEAKER_01: But yeah, should be good.
37:14
SPEAKER_01: Yeah.
37:14
SPEAKER_00: Great.
37:15
SPEAKER_00: Well, I think that's a good place to wrap it up, guys.
37:17
SPEAKER_00: Uh, thanks for the chat today.
37:19
SPEAKER_00: And uh cool.
37:20
SPEAKER_01: I need to go and put my lion costume on, so I've I've got a dab.
37:26
SPEAKER_02: Enjoy the rest of uh Canada Day, um, Elliot.
37:29
SPEAKER_02: Um make sure you have some fun celebrate.
37:32
SPEAKER_02: Hopefully, I can celebrate the three lions.
37:35
SPEAKER_02: And yeah.
37:35
SPEAKER_02: Oh, thank you.
37:36
SPEAKER_02: Enjoyed it today.
37:37
SPEAKER_00: Yeah, we'll see you guys in the round of sixteen.
37:39
SPEAKER_00: All right.
37:41
SPEAKER_00: Talk to you guys next week.
37:42
SPEAKER_00: Take care.
37:43
SPEAKER_00: Bye.