Paul Ricard: Hi everyone, and welcome to Oliver Wyman's Reinventing Insurance podcast. I'm your host, Paul Ricard. Today, I'm thrilled to welcome Chubb's Chief Digital Business Officer, Sean Ringsted. Welcome, Sean.
Sean Ringsted: Thank you for having me.
Paul: Sean, we are here today in not so sunny New York City. Why don't you tell us a little bit about yourself and your role at Chubb today?
Sean: Yeah, so Chubb, for those that don't know it, is the world's largest publicly traded publicly and casualty company. We're in 54 countries. We do everything from accident, health, property and casualty, life. We'll cover a nickel taxi ride up to large multinational companies. We really span it all.
In my role, I lead our 100% digital business unit. What that means is making our products and services available in what we call the digital channel around the world, mostly B2B2C. I think we'll be talking a lot about that today.
Paul: Let's dive right in. Starting with your ambitions, priorities, highlights for you and your team. I would love to hear what's on your radar. You've already mentioned B2B2C.
Sean: Sure, we can start there. It's been a really exciting journey for us on B2B2C, and there's so much more upside on it, so much more to come.
Very simply, these are products that you can embed into partners' ecosystems, and provide to customers in a way that they couldn't access before, through mobile and so on.
To give a sense of numbers, last year, we wrote about $500 million in terms of revenue. We have about 200 partners around the world, and we think of them in verticals to help make it real. Think of airlines, telcos, retail, e-commerce, mobility. Each of these represent opportunities for us to provide value-added services to our partners and then, through them, to their customers.
As we look out, we see so many opportunities in front of us to grow and develop the products. Clearly, these are simple products, but they have relevance to our customers, whether it's life insurance, protecting yourself and your family, things around your home, gadgets, laptop, or your lifestyle.
Paul: So, in a B2B2C setting, tell me more about Chubb's offering, where Chubb's offering ends and where the partners' assets come in. How do these things come together? Tell us more, maybe with an example or two.
Sean: First and foremost, technology is critical, and we've invested in that ourselves. Our technology integration layer with partners, we call that Chubb Studio.
What that allows us to do is to very simply interface with the partner, and we can do that through APIs, r SDKs, or a widget. What we're doing there is really simplifying the product set that we have, and abstracting all the complexity that we have internally with policies, with systems, and all that.
What you're presenting back to the partner is something that's very simple from a technology point of view. That's been a real differentiator for us in the marketplace. It allows us to move quickly. It allows us to go toe to toe, if you will, with digital natives, because they're always a step ahead. We're at parity when it comes to the technology integration discussions. What that allows you to do, then, is focus on the important stuff, to your question about what you need from partners.
It's one thing to figure out the technology, and it's one thing to have the product, but what we're really doing is creating experiences for our partners and their customers in their digital real estate.
When you think about a great digital native firm, you think of a Spotify or an Apple. They have these amazing digital experiences and now you're coming along and saying, "I'm going to introduce insurance into it." They say, "Well, we've spent a long time curating and looking after our digital real estate."
We are now suggesting that insurance could be part of that journey in some shape or form, and we can get into some examples of what those are, that is where you sit down, that's where the magic happens with the partner. That takes time.
You have to have a real partnership, develop trust with the partner to be able to deliver on that promise, and provide the customer something that's a great digital experience.
Paul: In terms of what's truly differentiating or what would be Chubb’s secret sauce, I'm hearing a combination of at least three things.
One is, obviously, the expertise and risk and creating the right insurance products. Two is, I heard you mention all the digital and technology elements, you are rivaling with all the digital natives, but that's a lot of skills that you've developed in-house around it. Then there's a third element around engaging with the partner, having the right degree of trust, that I'm sure takes a lot of time, and really meeting both the partner and the customers where they are at, so that, to your point, it doesn't become “we're having a great seamless experience, and then we're just pushing insurance,” it's really embedded inside the customer journey.
Sean: Yeah, it's got to be very contextual in that journey. I'll just pull up on one word that you said: “rivaling.” We're humble. We've got good enough tech to get in the front door. We've got good enough tech to integrate with our partners. We learn all the time on the tech side from our partners.
Another way to think about it, hopefully, from a partner's point of view, are all these great strengths that we bring as an insurer. We have balance sheet, we take risks, we have all these countries, we've got this breadth and depth of product. From a partner's point of view, 'I don't want to do the claims handling, I don't know the regulation. I don't want to manage your balance sheet.' If we can unlock that through technology, then we really provide the best of both worlds. We're bringing the strengths of a carrier, and then we have the technology to allow us to integrate. It's quite an interesting proposition for partners.
Paul: One thing that I heard, which I really liked is you said, "Look, we have all these things so we can focus on what really matters." Oftentimes, what we discuss with the industry is shifting from product selling to problem solving, how do you start from the customer problem back?
It seems like the most successful partnership is when you and your partner can really think from that customer problem back, versus, "Oh, how can we add on as many of these products as possible?"
Sean: That's absolutely right. Think of some really successful examples that we've had. One that comes to mind is Nubank in Latin America, and another one is Grab in Asia. Both of those, exactly to your point, came about because the partner said, "We've got this problem. We've got this pain point with the customer base." That’s where Chubb Studio comes in, which originated from this idea that you can sit down and collaborate. It's how do you put all of that together and create this amazing customer experience?
Paul: I would love to hear more about Chubb Studio, how it came to be, what kind of talent do you have? How do you folks make the magic happen?
Sean: Madrid was actually the birthplace of Chubb Studio. We were getting, as you can imagine, all the whiteboards filled with squiggles, all the cups of coffee. I said, "Okay, this is what we need to do." That's how it was born.
The other point I'd make around it, it's one thing to figure out the sales journey and integrate the sales journey, very much focused on making sure that the post-sales experience is the same, whether that's if you want to change your email address to the claims experience.
Paul: Before we move on from B2B2C: everyone is talking about embedded insurance. Intrinsically, what we described is every bit embedded insurance, but you used the word B2B2C. How do you see the distinction between the two, where is the Venn diagram overlapping? Why use one versus the other?
Sean: To give a couple of examples: if you have a customer journey with a bank or a Fintech, and the customer is taking out a loan – very natural in that digital journey – could you insert, " Here's some insurance." If you happen to get sick, and you can't keep up the loan payments, we can step in and help with that. In a lot of countries, low-income countries, that's incredibly valuable to protect an individual and their families. You can naturally insert that insurance proposition in the journey. There, you're "embedded," and it works for simple products. It has to be contextual. Travel is another great example. You book your airline ticket, very natural to present insurance there. You want it to be at the point where this makes sense to the customer, and you're explaining. It's the right place and at the right time, it's contextual, it's relevant. These are simple, affordable products. For me, where the magic happens is you go to, say, for example, in Brazil, I mentioned Nubank, and we're selling life policies there with three clicks on the phone. That's protection products to people that typically have not bought a financial services product before. The only way that you can reach them and make the economics work for everyone is through the phone. You can't do that through an intermediary. This idea that you can now open up financial inclusion to people through the phone, and that, to me, is where I think the power of this gets really, really exciting. To do that, to get the scale, you need to be B2B2C.
Paul: What makes a fruitful partnership from your standpoint for Chubb? I've heard a lot about trust, collaboration. What else? What is key? What makes for a fruitful long-term partnership?
Sean: It is such a fascinating question that we could unpack it a number of ways. If you and I are partners: we are sitting down across the table and there is trust. We're going to pay our claims on time, and we're going to pay them in the right way. Our technology will work. There's that trust element. For me, where you get the real value, it has to be long-term. It's one thing to be transactional, but where the real value creation comes is in the long-term, often because this ideation takes time to be sustainable. I love the idea of long-term partnerships, relationships. To be successful, particularly in this age, what else can you bring to the table? This idea that it's not just about the product, it's about what are the services that you can provide that are associated with the product.
Cyber is a great example, because we bring to the table services that help you with your cyber hygiene. It's about risk mitigation, so it helps you lower your risk profile, but we're still there. If something goes wrong, we can step in, and clearly we're bringing other types of services post-claim. If it's reputational, I've got to get the data back, all the legal, and all these sorts of things. That's just one example.
You see it in health type products. On this idea that you can bring additional services to the table, in some instances, you get something that's symbiotic, where the partner's also providing value back.
Paul: I'm hearing a combination of different business models that include, the more traditional insurance product and service provision, as well as being a strong ecosystem orchestrator – whether it's with an ecosystem of distribution partners or other solution providers. You mentioned cyber as an example, and it seems like going forward, for a company like Chubb, having both of these business models working well hand-in-hand is going to be crucial for success to you. Do you agree with that?
Sean: I agree with that. How that manifests itself varies in markets and in different ways, and by the nature of the vertical that you're in. Sometimes it can sound abstract, but now, if you start to think by vertical, think of airlines. Think all the services that get orchestrated into airline, or if you think of mobility, e-commerce, banks, each vertical is unique and different, and you need different services that need to get orchestrated.
Paul: Yeah. Can you tell me more about the differences you are seeing between the different markets? What do you see as a focus, whether it's by way of the customer demand, partner needs, etc.? Are there any major differences?
Sean: Yeah, there are. I would characterize it as pace. The pace of change you see, I find in Latin America and Asia, is that much faster than Europe or in North America. Nubank in Brazil has, I think it's 80 million customers, and they didn't exist four years ago. They're entirely digital bank.
The growth in Asia, we're very excited about. We made some acquisitions last year, and you look at the growth on the consumer side, and what we can do there across Southeast Asia, in Korea, in China. It's incredibly exciting. Wherever you've got growth in a vertical, travel's been reinvented, banking's getting reinvented. Mobility didn't exist five years ago. Look at e-commerce. That we're very, very, very excited about. These are changes that are happening in the US and Europe as well.
Globally, wherever you see these changes, I think there's an opportunity to provide insurance products. I think the other general comment I would make is this idea of services as well that complement product. I think that's a general trend, regardless of geography. What can you help the customer with, in terms of risk mitigation, risk hygiene, if you will? I think services will become, as a general trend, increasingly important.
Paul: I would like to talk about some of the trends to watch out for in the coming months and years.
There's definitely one topic I want to start with. It's AI. There is this meme, it was a video put together of all the moments where in the Google I/O conference, Sundar Pichai referenced AI, I think it goes “AI, AI, AI” 20,000 times.
I feel like that's a nice summary of 2023.
Sean: Yeah, for sure.
Paul: I’d love to just get your general unfettered take on AI overall, and where you see things going in the next two, three, four years.
Sean: How long have I got? AI, AI. Well, big topic. I think there's been a tipping point or a breakthrough in a way that's very, very real. A lot of the headlines are around ChatGPT, and then you get into generative AI.
I think if you go another level down, what's really changed are these concepts around large language models in other forms, whether it's video or voice. These are going to go multimodal pretty quickly, and that's the real power.
We've been playing with some of these models before as well, but when you actually see the new ones and what they're capable of, it's pretty cool. It's pretty exciting. Now, that's not to say it's going to happen overnight, and there's a lot here in terms of how they're going to get used, how they're going to apply, what regulation is going to say.
I think the other dynamic that's changed is the credibility around it. If you brought up AI three or five years ago, we were playing around with it almost like in the basement, but now, many people, executives, management boards you talk to, there's an expectation. It's real. It's very much front and center in terms of what problems it could help solve.
Paul: I love the point you brought up about how the conversation has changed in the boardrooms and the management teams. One thing that has really surprised me, and I feel like there's really been a pre- and post- ChatGPT on this, is even a year, two years, three years ago, you could go and have a very interesting AI solution that could determine a roof type with 90% accuracy, and you would bring this to insurers or others, and the reaction would be, "Well, it's wrong 10% of the time, so we're not interested."
Now, there's more of an openness to that high level of accuracy, “90% accurate, it's pretty good”, but also the shift from, "It's not always going to be a replace, it's more of an augment." Bringing it into the right setting is something that everybody seems more open to. What do you think?
Sean: I think that's absolutely right. I agree with that around the augmentation and the relativity.
You know the machine's going to get better, it's going to learn. You've got a baseline and a track record, and it's going to get better. That's the other, I think, plus around this. You can see frameworks and processes develop, where you're just going to iterate and improve over time. I completely agree on the augmentation piece. Right now, you could say some of the uses for ChatGPT are fun.
Paul: What's your most fun prompt that you've thrown into ChatGPT?
Sean: We ran a competition internally and asked employees to send in their ideas, which was a lot of fun. We had some great ideas, and we had a category for creativity. One person used ChatGPT to say, "How can I win this competition?”
Paul: Very meta!
Sean: Yeah, it was very meta, but they didn't win. One of the interesting areas that will evolve is that it helps us create new data sets and new insights.
It's not that you're trying to replace something. This is about creating new insights, new products, and new services. When you look at some of the challenges and opportunities that we have as an industry, think cyber, think about the changing weather, climate, and so on. There’s opportunity for new products and services, and that's where I think AI can play a really interesting role.
Paul: Another provocation for you, like I haven't thrown enough already: in the insurance industry, whether it's underwriting, whether it's claims, whether it's in the distribution space, there is a common thread that is very true, that is there is an art and a science to underwriting, to claims, etc. An insurance organization such as Chubb with years, decades of experience is infinitely valuable.
One thing I've observed with, to your point, with large language models and all these things, is that yes, it's going to continue helping with the science part, but now for the first time, there is a prospect for AI to augment the art part. You were talking about creating. I really like the point you brought up. It's like, "How can I help an underwriter get ahead of the curve even more? How can I leverage all the insights we have?"
Sean: On the science part, it's going to expand the pool of data that you have around science. It's going to expand the insights that you have around science, and you'll always have that judgment, for whether it's underwriting, or risk engineering, or claims, and it will help augment and help make us individually, professionally, and make us better.
Paul: Three, five years from now, what do you think it will take to be ahead of the curve or on the right side of the curve?
Sean: This is still playing out. You look at the time, energy, and effort that's being expended globally by people into AI, and even in the last six months, you see different ways and techniques to train the models, to teach the models. It took a month before. It takes a day now. It's all evolving. It's evolving pretty quickly. That just means you have to be nimble.
The other point I would make around this, and it's something that we're very focused on: AI gets all the attention, but there's a lot of hard work that has to go on to enable it. I'm talking infrastructure, data, data engineers, cloud. There's a big pool of expertise that has to go around to support AI, and we're investing in that as well.
Paul: Moving on to another topic, and we'll probably have some similar themes coming, is predict and prevent, which you've alluded to a little bit earlier.
What's your general take on predict and prevent? I feel like this is probably both an insured's and an insurer's dream to move towards predict and prevent versus repair and replace. Where have we been? Where are we now? What's the future like? What's your take on this?
Sean: I'm a big believer in the predict and prevent idea versus a repair and replace model. This idea that you can measure exposure, I find really interesting, because I trained as an actuary, and you were always guessing for exposure, or you were trying to find proxies for exposure, on which you could do your risk assessment. It's so fundamental to what we do. Then along comes technology that potentially allows you to measure exposure in a much more direct way. You don't have to have proxy or inferences. If you can do that, that's great for risk selection. Then it also now starts to open up the door for a much better risk management, much better if you can alert somebody about a problem and they can take proactive action. Better for them, as you say, and for the insurer. You avert that claim, and it's not just, "Okay, we'll cut you a check or send it to your digital wallet." It's everything else that happens. You have a flood, you have to go and rip out the carpet, you've got to go and live at the hotel. You're worried about mold. You can't get your sofa back the way that you wanted, etc. Much better to prevent it, I think.
Obviously, auto led the way in telematics, but you start to see it emerge now in health and wellness in various forms. You can see it in property, personal or commercial, this idea that sensors and technology can help detect and prevent things, and ultimately, hopefully predict things.
Paul: I believe you had some recent partnerships and acquisitions where you've seen measurable progress and change through predict and prevent, through sensors and all.
Sean: Absolutely, yeah. We've invested in the expertise you mentioned, we acquired a small company called Streamlabs that has that. This is technology for water or shut off, leak detection, and we put it in homes and on our high-net worth portfolio and commercial. Yeah, it's quite funny, right? You see these examples and you go, "Everyone should do this." It's like, " Why wouldn't you do this?" We've seen it in hospitals where we prevented catastrophic flood onto the operating theatre. We've seen it in a library full of beautiful books, prevent a flood happening to the library. We put them in colleges, universities, campuses, and we've seen enough use cases and you go, "This is real, and it's really impactful for the insured and for the insurer."
Paul: There is a thread between what you were sharing on AI and this, which is there's a lot of the underlying infrastructure that needs to get there for it to be truly enabled.
Sean: Yes, AI will help. There's much more dialogue now around convergence, around the technology and compatibility.
Paul: What role do you see Chubb having in the value chain three, five years from now? Again, if I think about cyber, if I think about property, to your point, maximizing predict and prevent, how is that going to evolve? What kind of partnerships do you need to have? Can you share a little bit of your perspectives there?
Sean: First and foremost, we're an underwriting company, so we're never going to lose the sight of that, that's who we are. Then it's, where can we use either technology, or analytics, or data to better help our insureds, our clients? That's so important. We'll either be developing that ourselves, our own insights, or we'll, as you mentioned earlier, partner, as partnerships are incredibly important. It will vary by geography and product, who we partner with on the cyber side is very different to who we work with, say, on the IOT side for property. This will take different forms, but at the heart of it, is it going to make our underwriting better? Is it going to be good for our clients? Are we going to deliver a better claims experience to you and to our shareholders?
Paul: It's not a solution in search of a problem. It always focuses on the problem.
Sean: That's so well said. Right. What is the problem that you're trying to solve? Having clarity around that, and it's going to be no one thing.
Paul: What else are you watching out for going into 2024 and beyond? What's top of mind for you?
Sean: Top of mind? I’m incredibly optimistic. I just think it's such a great time to be in the industry. I really do.
When you look at the problems around the world that people are facing, when you think about healthcare, and when you think about aging demographics in that way, we touched on the cyber landscape and changing weather, there's so many problems where insurance is really front and center and can provide solutions. I think it's a really vibrant and exciting industry. I wish I knew when I started out, what I know now. If I was young, and I was interested in risk, or technology, and data, wow, what an industry to find and join, and then have a purpose around it as well. You can play a part to solve some really interesting problems that are pretty unique. Yeah, I just think it's just an amazing time to be in the industry.
Paul: Let's talk a bit more about yourself. Reflecting back, building on what you were just sharing, can you share a little bit more about yourself, your journey in insurance, and what have been some fundamental learnings and moments that you'd love to teach to your younger self, or to teach to folks who are just starting or up and coming in the industry? Acknowledging that you have a lot more ahead of yourself!
Sean: Oh, thank you. Thank you. Glad you brought that up. That's good to know. I've been just extraordinarily lucky, in terms of the people I've met and the circumstances I've been in. People have always been very far too gracious and supportive, so having a network that way, I've been lucky that way.
I would say this, if you're young and you managed to stick to the end of this, is: take the opportunity. Every situation that comes up, whether it's a job, or a new client, or a new assignment, or recently looking to take on this role or go to a new geography, to me, I think that the mindset is: take it. This idea that if you're feeling stretched, just like, "I don't know how to deal with that, or I don't know where to begin," my advice would be: take it. Somebody has got faith in you and said, "Look, I believe this person can do it." You should take encouragement in that and just stretch yourself and take advice from people. Just take every opportunity that comes, because they don't come around again. You get these moments, and you look back, and I've had them, and I've made a decision, which to family friends can be counterintuitive, and said, "No, I'm going to take this opportunity."
Paul: It's been really fun talking with you Sean. I always ask for final words of wisdom. I've heard a lot of them from you today, but any final words of wisdom you would have for our audience?
Sean: I think we've touched on a lot of great points. It has been a great conversation.
I come back to this idea of the role and relevance of insurance. It really is a vibrant, vibrant industry. It's never been more relevant, so I think all of us in the industry really should be out there, because we need to attract talent and different type of talent than we've had before. I think there's this messaging around insurance and the vital role that it plays, and it's so cool. I think we just got to do more of that, because there's a lot of work in front of us as an industry. How we do that, the technology, or data and analytics, or people who understand risk, and can take on risk and manage risk, it's so important. I would just encourage everybody to be really excited about that, and go out there and be ambassadors for the industry.
Paul: Thank you so much. Thank you very much for your time, Sean.
Sean: It was great. A pleasure. Glad we could do this.
Paul: Likewise.
That was Sean Ringsted, Chief Digital Business Officer at Chubb. Thanks for listening, and I'll see you next time.
For more information about our Reinventing Insurance series, you can find everything on our website at https://www.oliverwyman.com/reinventinginsurance
