Digital fluency and future-focused skills: Building tomorrow’s insurance industry

"You know, old concepts are going to keep getting old business. And old business is, well, it's not going to grow, is it?”

The insurance industry has been burned by transformation initiatives in the past, with costly projects that haven’t had the desired material outcomes. However, as customers begin to outpace industry standards, it is time for insurers to adapt— leveraging their capacity and experience to enhance business models and customer experiences.

There’s a time and place for “incremental changes” and “small continuous steps”, but “moving into those bigger impacts” is vital to remain competitive.

Caroline Bedford, Chief Executive at EDII, is deeply passionate about fostering a future-focus that will serve professionals and the insurance industry in the years to come. Her conversation with TEC touches on everything from leveraging emerging technology for a commercial advantage to building confidence with digital platforms for senior employees.

A key message from the discussion is that successful technology transformation must be accompanied by a cultural shift. Mere adoption of a new platform or tool without a corresponding mindset change and widespread acceptance is unlikely to be effective.

Learn about:

• The appetite for change

• Cultivating digital fluency

• Building future-focused skills

• Preparing for a soft market

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Full episode transcript

[00:00:00] TEC: Hi, I'm Tom Chamberlain, VP of Customer Consulting at hyperxponential, and your host, otherwise known as Tech. And as ever, that's absolutely everything you need to know about me. I'm delighted to welcome you to this episode of TEC Talks, where today we'll be talking to Caroline Bedford, Chief Executive of EDI. So let's get straight into it.  
 

Caroline, welcome and thank you for joining.  
 

[00:00:33] Caroline Bedford: Yeah. Oh, thanks for having me, Tom. Really excited to chat this morning.  
 

[00:00:36] TEC: Excellent. I hope I pronounced the, the company name correctly, because the temptation was to say EDII, but I do believe it's “EDII” 
 

[00:00:43] Caroline Bedford: I was going to give you a little badge, actually, a little card, a merit card to say yes. Brilliant. EDII stands for educate, develop, innovate and inspire. I never knew to like started a startup, how hard it was to name an organization. so the, the, the name EDII came from some inspiration, from a.  
 

a fabulous connection of mine and, I thought that everybody would understand how to pronounce the acronym, but obviously I have, been sadly disappointed in that. So at every opportunity we say, are you ready for EDII?  
 

[00:01:17] TEC: ready for EDII? Oh, I like that  
 

[00:01:18] Caroline Bedford: Are you ready for EDII?  
 

[00:01:20] TEC: That's, that's good. And it's good that one of your sort of, I guess, four pillars is innovate, because I think that's where we should probably start today. So, Caroline, to kind of kick us off, how do you reckon the insurance industry, is at innovation in general?  
 

I know that's kind of a big question, but, how do you, how do you see it? How's it been evolving?  
 

[00:01:38] Caroline Bedford: So it is a big question and I kind of look at it in, in, as we do in a lot of ways, we kind of, what's the risk profile? How do we segment? So if we look at, if we look at insurance in general, we want to segment it. because otherwise it's not a homogenous mass, is it? so I would, I would always say that if you're looking at, the more general lines, it's, you could see that in, in, in that sort of area, it's a lot more easy to innovate because you are closer to the customer.  
 

You are generally not operating in a subscription market. whereas when we look at specialty insurance and reinsurance, in many ways, the further away from the customer you get, the harder it is to, you know, to sort of make, quick change. But, but what I would say is innovation in itself is not one size fits all.  
 

At EDII, we always focus on innovation, the three levels of innovation, quite commonly known, incremental, breakthrough, transformational. and I would say that the insurance industry or the specialty insurance industry that, that, that I work in, is particularly good at making those incremental changes, at making those sort of continuous small steps.  
 

It's moving into those bigger impacts, so the breakthrough and transformational, that is naturally harder when you have to consider other parties doing it with you, and in many cases you've got intermediaries. And then you are, to some degree, further away from the direct customer. So it's naturally harder.  
 

and it's, I think it's those areas that we need to start focusing more effort on.  
 

[00:03:19] TEC: Makes sense. Makes sense. I think it's interesting that you say it's kind of harder on the specialty sort of side of things. And I, there's also an advantage on there as well, because I think technology, compared to some other industries is, has been a bit lacking there. And there's still the sort of temptation to use Excel spreadsheets everywhere.  
 

And there's, there's a lot of processes, which I've, I've, I've chatted on some previous podcasts around automation, and we're still talking about automation and automation has been a thing for the last 20 years of my career, and we're still not doing it properly. And it feels like there's, there's a lot of scope there for kind of technology driven innovation on the specialty side.  
 

I think as you move towards, maybe the more sort of personal lines areas. There's a lot of technology there, which is helping. I mean, you and I can go and buy our house insurance, car insurance relatively easily, but the way that insurance is purchased in this sort of specialty reinsurance is still very manual and potentially that opens the door a bit for innovation.  
 

[00:04:21] Caroline Bedford: That's the opportunity, isn't it? So the specialty, you know, we're not seeing, we're not seeing exponential rate of change yet. but we are, we are definitely seeing growth in behavior, in interest. so as, as you've just sort of described, yes, automation, you know, automation, EDII, we are, we are seeing a massive increase in one of the products that we do, which is called Digital Safari.  
 

and by product, I mean, it's an educational tool teaching people about emerging technology. so one of our digital safaris started last year focusing on IOT, focusing on, machine learning, artificial intelligence, web3 capabilities. and you know, that was lovely, potted along, got along, you know, got, it got the, the level of interest that it needed.  
 

We are taking booking after booking now. because the, the interest level in generative AI, the explosion of its capabilities since, You know, chat GPT opened the doors, but it's not now, it's not the only generative AI model out there. but it's really reinforced the message to the specialty insurance market that their clients are using this technology.  
 

Our clients are using this technology. Our clients are starting to, experience different risk as a result. We need to adapt our risk as a result. So we are, we are seeing levels of interest. exponentially increase as opposed to, you know, maybe this time last year.  
 

[00:06:00] TEC: No, that makes sense. And yeah, changes happening rapidly. I mean, generative AI has taken a sort of a huge step forward and sort of lowered the entry level for some of these more difficult technologies, but it feels from what you're saying, there's going to need to be a bit of a skill shift. you know, it's everything is changing.  
 

Technology is changing. And, how, how do we, I mean, what, what even skills do we need going forward? Because presumably we're going to need to change those, because we're not living in the same world and things like generative AI will, will really transform us.  
 

[00:06:32] Caroline Bedford: I never, I, you know, absolutely, you know, people who we, you know, we do a sort of show of hands in a, in a workshop or a conference and what have you, hands up who uses chat GPT. you know, you asked this question six months ago, you'd get. Just a few early adopters. Now you would get more. But if you ask the question, hands up, who uses chat GPT at an enterprise level through their organizational systems, the answer is still no.  
 

you know, so that's, that's, and that's where those big changes are going to happen. just on the breakfast news this morning, in the education sector, teachers are now starting to be educated on how to use. generative eye in large language models to create lesson plans. so they, you know, they recognize that there is capability there.  
 

And rather than, you know, put your head in the sand, let's, let's use these capabilities. And I would say that teachers, you're not probably representative of a, you know, traditional, a traditional, profession who've learned in a certain way. So, in terms of the insurance sector, you can probably draw parallels.  
 

You can draw parallels there. that we have got a lot of, if we look at the London insurance market, for example, what's that 45,000 people supporting it, something like that. And then think back to the last census that was done, the London matters report. I think they said then that 80 percent of the market workforce was aged over 30.  
 

So that's significant, isn't it? so, you know, the, and, and. The majority of those, therefore, are certainly in the 40s, 50s. They're not digital natives per se. although they're digitally comfortable. you know, I'm mid 50s. I'm really digital, digitally comfortable. I've been in the, I've been in insurance and technology since the late 80s.  
 

and change is opportunity. But what, what we're looking at is the skills that people need. and I think, you know, three or four years ago, when these kind of reports were done, people were saying, you need to be more data scientist, you need to be able to low code. I think we've moved away from that now, and it's, it's far more about digital fluency, or at least removing digital fear, and getting people comfortable that knowing what the capabilities is really important, but moving Those two together means being able to be a creative problem solver, be able to be agile, be able to adapt.  
 

Those are the sort of skill that I see people really flourishing with, those ones who are open to explore and to continue to learn.  
 

[00:09:28] TEC: Yeah. That, that makes a lot of sense. I like your phrase digital fluency. It's, it's, it's going to be really critical going forward. And you mentioned You know, even now, when you put when you ask that sort of question around who's using genitive AI at an enterprise level for that, and they're still sort of tentative and not much going on.  
 

Do you think that, particularly in the insurance side, do you think that's down to. this this digital fear or lack of skills, or is it also use cases? So where, where can we actually do this? You know, you mentioned teachers using this for lesson planning, which sounds like a really great idea. and, you know, people have found their own sort of personal use cases and, a friend of mine uses it to help him write bedtime stories for his little for his little kids and, being a being a great dad and stuff, which I think is pretty awesome.  
 

But. Finding those real key use cases at an enterprise level can be tricky as well. So is it, is it the skill set or is it the use cases or is it maybe a combination thereof at the moment?  
 

[00:10:27] Caroline Bedford: I think you've got to know what's on offer to be able to help you figure out what sort of problems to solve. so this is why we think that digital fluency I think is really important. because the more you learn about what, what the art of the possible is, it opens up a lens on things that you maybe didn't even know were a problem or an opportunity to start with.  
 

but definitely technology as a tool we've seen in the past. You know, one of the reasons why, you know, blockchain came to the, she came to the sort of fashion parade, the London Technology Fashion Week. You know, blockchain was all, all over it five, six years ago, but it was too early. you know, it's too, it's too early, but, also it was seeking to bring in a technology for a problem that nobody was really experiencing at that stage, or wasn't feeling the pinch of it.  
 

So, you know, the, as you said, the, the key is technology really thrives when it's solving a genuine problem. And the use cases, you know, what problems do we want to solve? Um. So, what I would always say is, you know, in insurance, in specialty or any kind of insurance, what do we do? We protect customers from financial risk of, you know, financial result of loss at the moment.  
 

let's look at use cases then. So, so those customers, their, their business models have changed, their behaviors are changing, their culture is changing. There's a massive amount of use cases, use cases there. We, we look at big organizations, massive global organizations, manufacturers like Renault, for example.  
 

there'll be many brokers and insurers listening to us today who have them as a client. they're manufacturing plants, they're digitized. They've created digital twins so that they can streamline their operations. They're connecting their supply chain. When our customers are out innovating us, that's when we really need to sit up and take notice because we need to start thinking, OK, what use cases are there where our capacity and our experience can improve their business model and their customers experience.  
 

[00:12:48] TEC: Yeah, absolutely. I completely agree. and you mentioned there as well, the London market, you said the survey, it was 80 percent of people or over 30. so we have a sort of a fairly heavy age weighted, industry. so. And I realize this is probably a loaded question, but should we be looking to this younger generation, the sort of digital natives, for, for, for these sort of latest innovations and thought or, or is this a whole industry problem?  
 

How do we do that? Because they're probably the temptation is to go and go and hire a few, a few graduates who are sort of fresh out of university with, with these sort of general skills and go, ha, ha, come and solve all our problems, please. But I suspect that's probably not the way.  
 

[00:13:33] Caroline Bedford: I think I've always said, you can't be We're always talking about, we're always seeking to get a more diverse workforce. And I don't think that you can be inclusive by being exclusive. So one of the things that I, you know, I'm really proud. To be part of the 50 over 50 group. there's an amazing, an amazing, initiative in the, in the industry highlighting women over 50.  
 

and I think that, you know, there's an enormous amount of expertise in the market that should not go anywhere and probably isn't gonna go anywhere because you don't learn nuance and detail and experience about specialty sectors overnight. Nor can you. But you can combine that with Fresh focus, different way of thinking, you, you know, so I, I really believe the, the combination of experience versus fresh perspective is, is where that is kind of where that center, center lies.  
 

But what I also think is that one of the keys is getting that very senior leadership team. And in many cases, this, you know, senior leadership teams are already really future focused, but in other cases they aren't. you know, they're still, you know, they're operating in a hard market, they're doing quite well, but you know, all of these things, so, you know, the, the sort of themes and trends that many of us are talking about now still seem sort of left, left of center to them.  
 

And again, that's not, that's certainly not representative of the entire market, but it is in pockets. so I think that by getting our leaders to under, to be digitally fluent. To truly understand what the client sector is, change is happening and how that needs to filter up. I see that as one of the keys that will unlock our innovation potential.  
 

[00:15:27] TEC: And is it, did you find it? It's easy to convince businesses that this is the way of doing, you know, you know, it feels like a sort of similar thing, you know, like get some good technology, you're going to be better at business, you know, like hire the best people, you're going to be good at business, get everyone to be better at innovation, that's going to be good for business.  
 

Did you, when you're speaking to companies, did you kind of make this more tangible? Well, what's, what are the kind of outcomes that you're sort of telling insurers they're going to get from this?  
 

[00:15:56] Caroline Bedford: Yeah, well, we are kind of, you know, in, in the same way that the market, you know, has leaders and followers. we see organizations who are really at the forefront of this and then others who are still, you know, waiting, waiting to see. But essentially, if you embed your, okay, if you. Have talented people and yet your model is not changing.  
 

They're still focusing on traditional risk and it's not seeing any any sort of There's there's no roadmap to extend those products or offering what's going to happen you they're going to lose interest They're going to not be engaged. So lots of Forward thinking organizations know that to retain their talented people they have to give them interesting topics and interesting education to be able to energize and put those brilliant minds to brilliant work.  
 

You know, old concepts are going to keep getting old business. And old business is, well, it's not going to grow, is it?  
 

[00:16:57] TEC: No, that's right. And I think, that there's a bit of companies that are sort of hiding, not hiding behind, but, the hard market is masking, I think, a little bit of where you've got these leaders and laggards, you know, when a hard market, everyone's, everyone's happy and making money, when the market probably be able to be turns, then, then it's going to, it's going to change around a little bit.  
 

and I guess we'll see the, the, the, the ones who are sort of embracing this. I mean, and have you seen, probably can't go into too much detail with, with, with the companies in particular, but what, what, what sort of really great examples of you've seen where people have gone away and, and, and change the way they're doing things and, and innovating more.  
 

Have you got some examples of where, where you've seen this sort of activity happening in the market?  
 

[00:17:41] Caroline Bedford: Yeah, absolutely. There's lots of examples of where innovation is happening in the market. We tend to look at it as a, as a, you know, overarching entity, don't we? So we're kind of like, well, it's slow to turn. But if you look, So, one of our, one of our Digital Minds alumni, a guy called Alistair Blundee, fantastic, fantastically innovative mind, aviation underwriter, you know, now CEO of Skyris.  
 

Skyris is a great example of where insurance sees trends and themes of their, of their time. You know, there's sort of traditional market and see how it's, how it's growing. So you look at something like Skyrisks, which is now, back with capacity from Convex. they are, they are looking to, provide capacity for advanced mobility in the aviation sector.  
 

Really, really, really fascinating. So somebody like Alastair and Skyrisks, they understood the problem. They understood that there is a need to offer protection for that evolving marketplace. you know, what we're looking to move to 100 percent electric aircraft. Not sure I'm going to go on holiday on one of those anytime soon, but you know, electric aircraft or autonomous aircraft, cargo, vertical takeoff and landing, you know, this, this market sector is growing and a traditional underwriting products isn't going to cut it.  
 

So you've now got, you know, an MGA that's just, you know, just been launched great capacity, great expertise. So now. In the London insurance market, we are able to offer protection for, for, you know, that, that emerging marketplace and potentially, you know, we'll certainly, maybe it's one of the only, capacity offers right now.  
 

So there's certainly, you're certainly a leader and will continue to grow. Another example, we've got, MIC Global, syndicate Lloyd's, offering embedded insurance via digitized and AI platforms. So again, you know, growing and growing. The ability to, offer banks and other financial services access to the London insurance market, via embedded products, by fully automated processes.  
 

Those things are, are out there and have been established for quite some time, but we're just not shining a light on them.  
 

[00:20:07] TEC: you know, the, the, sometimes the frustrating thing for me is, is, is in the insurance industry that it is this, you talked about innovation sometimes sort of being, incremental as opposed to transformational. And, I don't, I I, I find that really frustrating sometimes because it's, it's, it's slow and it, it takes a long time and I, I want things to change more rapidly.  
 

And, and sometimes they do, sometimes they don't. and, I, I've, I've always had a few ideas, but I, I'm curious is like, if. If you could sort of immediately change one thing, around our industry, if such a thing was possible, what, what, what, what would it be?  
 

[00:20:42] Caroline Bedford: Oh, a magic wand. Have I got a magic wand? I've got a magic wand. Well, I have a wish that I don't want to waste my magic wand on. So I suppose I would say, can we just say that we all would like to fully transform legacy systems? So let's just say I'm not going to waste my entire wish on that though. If we could digitize all of our legacy platforms, then let's say that that's happened.  
 

Ooh, well, mine is not around technology. It's about embedding the skill. I guess I would say it's about growing the skill set to make technology. A ubiquitous tool. And I think what I would probably look to do there is to say, let's take all of the vertical role development pathways. So, you know, every, every industry, every organization in our industry will, will have had, and probably still has the underwriting assistant, assistant underwriter, underwriter, class underwriter, et cetera, et cetera.  
 

So that, you know, that kind of vertical, I'd love to take those. career pathways and add a horizontal skill set across all of them. So absolutely keep that domain expertise massively important. Although what it looks like will change. but I think adding that, you know, horizontal requirements. So we've got digital fluency, we've got, curiosity, adaptability, agility.  
 

in essence, you know, we, EDII, we talk a lot about adding generalist. capabilities to your specialist skill set and I think that's, that's massively important. We are seeing, I've got, I've got a couple of generalists, in my, in my sort of mind when I think about that, who are now leading massive international organizations.  
 

so they, the two in question, were originally actuaries, then they were chief actuaries and now they are CEO and chief underwriting officer. Of different big, big, big brands that we would know about. and they are leading successful cultural and innovative change because they have got this horizontal skill set that is helping cascade that throughout their organisations.  
 

So, that's what I would... EDII, horizontal skill set, roll! Totally,  
 

[00:23:00] TEC: One of my... things as well, working with technology over the years, you know, it's, it's, it's all very well to go and do some big transformation project, do it successfully, which in itself is incredibly difficult, but, given you've done the transformation successfully, you can't then expect all of a sudden, aha, now we've, we've, we've waved the magic wand and we've, we've got to where we are, because if you don't then help the culture change to be me.  
 

Data driven, technology driven, give them this sort of generalist bit that you were talking about, then the transformation won't work, you know, technology for technology sake is, is, yeah, it just, it doesn't do anything. You've got to have that mindset change and you've got to have the people embracing it.  
 

So, I'm definitely a big part of transformation, technology transformation, but with cultural transformation at the same time. And I think that's kind of what you're saying there. 
 

[00:23:53] Caroline Bedford: Totally. I'm going to give a shout out actually to Nick Lyon at Markell because he's that chief underwriting officer that I have in mind. you know, he's come from that actuarial background to chief actuarial background. absolutely well known in the actuarial world for being, you know, very, very forward thinking.  
 

Now, doing the same for Markel International on the CUO side, because of his knowledge and understanding that the horizontal pillar needs to be tip top in order for all of that cultural change to, to be able to adopt, any kind of technology.  
 

[00:24:28] TEC: This has been brilliant. I've got, I've got one more question, which, which I ask to everyone actually, and we kind of touched on it a little bit before and, maybe without the magic wand, what do you think insurers should be doing like now to prepare for the probably inevitable soft market to come?  
 

[00:24:47] Caroline Bedford: Well, I think we're looking at different lines of classes of business, aren't we? Where would you say that inevitable soft market is going to land sooner rather than later?  
 

[00:24:53] TEC: first, I've, I'm already, I'm already hearing talks in, in, some of the financial lines classes and, even in sort of, general aviation, larger aviation, less so, but started to see pockets where, competition has started to increase again to the point where rates are flat, if not starting to fall as people try and gather new business.  
 

So, Probably in those areas and then you'll find liability comes a lot later, but, we'll at some point, follow, property again, probably a little bit different, but definitely financial lines and a little bit of aviation starting to see that and, I would expect Marine at some point to kind of  
 

[00:25:33] Caroline Bedford: So we can have this conversation next, this time next year. It's Halloween today. That's a good day. We'll remember it, won't we? We'll remember it. yeah. So, so, oh, what would I say? what's good practice full stop is, is kind of what I would say. So whether you're in a hard or soft market, customers want to feel that you know them, customers want great service.  
 

in a soft market, you're going to have to be better at that, aren't you, because they've got more choice. you know, so you can't rely on scarcity, just to, just to, you know, an apathy, for people to stay with you. so what I would say is skills that organizations need to really, really, you know, double down on, when competition is high, when pricing is low.  
 

it's understanding their customer, it's understanding segmentation, it's getting great insights into, what product lines are doing well for you, what's going on in those areas, what those customers want, how you can adapt. So it's, again, if we're talking about technology slant on it, it's, it's all about having information at your fingertips, isn't it?  
 

It's not guessing. so we're looking at, at technology, so you're looking at, um... AI driven dashboards, you're looking at data driven insights, you're looking at data driven decision making, to help those, you know, you sort of humans. we do a lot of work with an organization called Send Technology.  
 

fantastic. There's some insurers who are already benefiting from their AI powered dashboards, the underwriters are finding that it's giving them so much more insight that they're able to adapt their product set more dynamically. They're able to understand what that target market, looks like at the moment, what changes have happened and what's coming along the future.  
 

So I would say that to navigate any kind of circular, circular, circular, that word, whatever it is, to navigate any changes in, in pricing and market models and behaviors, obviously data is key. So partnering now with really, you know, Organizations that, that have your same values and understand you and have that expertise is what is going to help you, you know, secure your capability for any changes that are ahead.  
 

[00:28:00] TEC: You would say exactly the same as I said. I agree literally with everything you're saying there. The data driven decision making is completely critical. You know, you need to, you said it yourself, have the data at the fingertips, right? So you can make those best decisions, which can help you drive the business forward, can help identify those margins when the margins are getting tighter.  
 

literally could not agree more. This is, this is an absolute critical piece. And again, technology, like companies like SEND and others who can help with this. It's, you need to embrace that and again, enable your underwriters to be making the best decisions they can. So, I  
 

[00:28:37] Caroline Bedford: Totally. I'll just, I'll just sort of wrap that up with a little quote from one of my, really amazing associates, Catherine Bryant, who runs the Insurance Breakfast Club. One of the tenets that she shares with her, with her delegates is don't wait.  
 

So, I think that can apply here as well. Don't wait. Start these partnerships now, because if they are true partnerships, don't wait until you suddenly think, Oh, we're about to lose, you know, we're about to lose this account. start now. It's too late by then. Start having these partnerships with, with a brilliant, genius, insurance led, technology companies now, so they can help you navigate and take advantage of what's to come.  
 

[00:29:19] TEC: Perfect. I think that's an absolute perfect time to, to end that. And that's a great quote as well. So, Caroline, thank you very much for joining. It's been a pleasure chatting.  
 

[00:29:28] Caroline Bedford: I've really enjoyed it. Thanks for asking me.  
 

[00:29:30] TEC: Of course. A massive thanks to Caroline for that. I really enjoyed our conversation. So much to think about, so much to unpack talking through digital natives, transformation, and the need to educate across the insurance sector.  
 

If you enjoyed that, check out episode 1 where I was talking to Caroline McDonald on women in insurance and transformation and also episode 6 where I spoke to Alice McGowan on transformation and DE& I. And that concludes our episode of TEC Talks. If you enjoyed today's show and want to find out more about the topics discussed, head over to hyperexponential.com to gain access to a range of resources relating to this episode. The link is in the description, and of course, wherever you're listening to this podcast, make sure you like, subscribe, and leave us a comment or review. Thanks so much for joining us and see you next time. Bye!