ReInsurance ReImagined Navigating Climate Risk, AI and Market Volatility

Thank you your excellency, distinguished uh guests, ladies and gentlemen. Thank you for being with us today. Um we have um Mark Wilson and Andreas Burgerer with us. I will do the introduction a little bit later. I am very much honored to represent uh the first reinsurance association in the ADGM and the UAE area.

I am one of the founding member and I am extremely proud. We have made um a very big step to support the reinsurance industry not only in the ADGM but also in the UAE. We have aligned with ADGM's mandate. We have aligned with Abu Dhabi's vision and the UA's vision. We will engage with all stakeholders and we need your support.

So this is um a call to all reinsurance companies, captives, insurance companies, brokers, stakeholders to engage with area. So thank you for this and allow me although everybody knows you gentlemen Mark Wilson is the CEO of RAQ a board member of Black Rockck exco of Aviva exco CEO of AIA andreas Burger is the group CEO of uh Swiss. Thank you for being here. You know reinsurance is very important for all of us. So we have a lot of questions.

The first one is related to data. Traditionally insurance reinsurance it's a data business. So we collect B data for risk management. Our question is and I will uh ask Mark and then address I will come to you based on your experience. What truly sets today AI apart is an evolution or is a revolution?

Well, um, good afternoon everyone and Aphroditi. Lovely to be here and good to be here with my friend Andreas as well. You know, I'm always amused when people talk about data as a new industry because insurance has been doing this for well over 200 years. Uh, insurance has been using data. All that has changed is the velocity, the pace, the computational power.

Um, I think of AI, uh, it's exceptionally good at being a fabulous historian. It's a wonderful accountant. It's a great actuary. It's, uh, great at doing the data entry, but it's a lousy fortune teller. And if you think of it in that context is why you need what it does is speed up the process.

That's uh that's what it does. And we but we have an issue in our industry. Our systems are decades old. We've probably got more legacy systems in the industry as a whole than anyone else. And so we're not necessarily built for AI.

And that is both the challenge and the opportunity.

Andreas. Well, first of all, thank you for having me here. It's so exciting. There's so much happening here and AI is the first word that I hear everywhere. So, in order to be AI ready, you need to be data ready.

As you said, Mark, all we have is data and people. Swiss 3 also for over 160 years of Swiss 3 existence, we deal with data. We deal with data and we channel it the risk insights that we derive out of data through what we call the sigma studies. Everybody who's in the industry probably knows about it. I grew up with this in the industry.

Now if you then take data and the data foundation with a proper clear ontology then you get to the tech side where you also have to have a sound tech foundation and then combine the data foundation with a tech foundation. If you have that together and you manage data well, then you can call yourself AI ready because then all the AI use cases are being integrated into your data and tech integrated infrastructure that we do globally. And for that you need the right partners. And what I appreciate really here the vision in Abu Dhabi the vision to say by default we need to be AI ready and enabled don't start with the historic way of approaching this. So that's why we very happy to be here and to then also bring our experience on AI and data into the mix.

Thank you. One next question is about capital markets and regulatory frameworks. So in 2024 um the global insurance capital reach approximately $770 billion and yet it's clustered in traditional hubs. Emerging markets drive approximately 40% of the global GDP growth but struggle in terms of capital access. How is technology sifting that?

I mean technology is the center of ADGM and this event and um Mark or Andreas Andreas would

I mean why don't I start looking at it from the outside we are a global company a global leader in our industry vertical the reinsurance space capital flow is everything we need our business model globally relies on diversification global diversification when I looked at Abu Abu Dhabi and also the ADGM. I found this interesting vision of a growing regional market.

Mhm.

With the vision and wish to have state-of-the-art regulation because regulation is important. We need solid regulation because it's about reputation also of a marketplace. This vision was then accomplished with a proper global benchmarking exercise to see who's doing what in the world and try to combine the best practice examples and see is this applicable here. And the third thing is engagement, collaboration, committing with the right partners who then bring in their expertise like ourselves. We operate in a lot of regulatory regimes and what we need to be careful with is not to take shortcuts.

We need to have of course level playing fields but there is competition but regulatory arbitrage cannot lead to shortcuts. We need the solidity in that marketplace to have trust. That's why also names like Swissree and trust is everything we have by the way and then translate this into resilience. The resilience of a marketplace. That's how I look at the regulation here.

Thank you Mark.

You know I've got a simple investment thesis and that is that capital will not go where it's not protected. It's simple. And if it's uninsurable, it's uninvestable. And I think too many parts of the investment ecosystem forget that now. But we do have a regulatory problem.

I think globally um we have decades upon decades of layers upon layer of regulation and I've been fairly outspoken on this in the past. Regulation as Andrea said is fundamental but what we need is some pragmatism combined with prudence. Now, uh, many may have missed it, but last week in ADGM, they launched a consultation paper for new solveny rules

for reinsurance and insurance. And these rules, I think, are both prudent and pragmatic. They learn from the mistakes of the past. They're very much riskbased, but they also allow diversification of geography, of investments, of products. And if anyone hasn't looked at it for those in this sort of industry, please look at it.

I think it's worldleading. I think it's got the potential to really add to the regulatory landscape and I congratulate our friends in ADGM for getting there.

Thank you. Well, we have every major insurance region has developed its own centers of excellence. Zurich, London, Singapore, uh Bermuda. I believe that uh now Abu Dhabi clearly has ambitions to join this list. Um what makes um a regional hub successful and allow me to start with Mark and I will come to your address.

When you look around the world, um, every region has a regional champion, a regional hub. Uh, you know, from West Re is is one of them certainly. But to be successful, investors and insurers and reinsurance companies want four things. They want stability of leadership. They want leadership that is consistent and has a vision just like here.

They want proximity of capital. You've got 4 trillion in the GCC and sovereign wealth funds just like here. They want the prudent yet pragmatic regulators. I've just spoken about that. And I think lastly, they want the ability, we want the ability to hire people, good people want the ability to use local talent and bring in international experts.

If you want the ideal insurance hub, you're sitting in it. For me

ultimately it is about proximity also proximity to markets declines and if you look at the region here and compare it with traditional platforms London and others you will see that in relative terms they're growing faster than any of the traditional marketplaces. So it is for us not shifting businesses, it's also net new growth. So we want to be where the markets are dynamic, where it's happening, where we can bring everything Swissry has to the party in order to increase resilience of not only the marketplace but also the societies. That's our purpose. We make the world more resilient.

And I can see this here in this marketplace. It's extremely dynamic. on day one of the opening of you know this conference we have seen impressive growth numbers if this is going to continue why not being here so that's the place to be and then if we can help make this a strong marketplace that would make us happy yes thanks

okay I think we tick all the boxes of what you have mentioned that makes a hub very successful so all the points you mentioned I think Abu Dhabi adm and ticks everything. It

does.

Um I want to ask you gentlemen, we have been talking about technology transformation, capital markets, AI, governance throughout this event and this panel. There is clearly a strong alignment between your companies. So I'm wondering if there is any concrete announcements you are about to make. You or me? Me.

Okay. [laughter] You know what, Ephoditi? When we were sitting here looking at how we could build out insurance business here, we realized we needed partners. We needed partners on the asset side and we also needed partners on the liability side, both sides of insurance balance sheet. And um on the asset side, we announced uh some time ago that we' partnered with BlackRock.

uh obviously I've got a fairly close connection with them uh and Lunate and others and uh that's working out wonderfully and then on the liability side we said well who's got the scale the expertise um you know the experience but also the reputation that trust issue that Andreas was talking about and uh I went and saw Andreas and uh we're announcing today a partnership between RIQ and Swissry in two areas uh on data and AI and the technical elements of insurance and then also how to build out this region how to build out this region as a regional hub as another global powerhouse sitting here in Abu Dhabi and

I'm very happy to sit here today and I sit in another panel there are three things that people need leaders need here in the market. But we share this um those three things. Number one, you need vision and anticipation. You need to imagine something that's not here today and that is going to end up being successful. Number two, you need to have stamina, persistence, and selfm motivation because everybody's going to tell you it's not going to work.

People don't want changes and there are too many people here who say it's not going to work. So selfm motivation. The third one jointly we need inspiration. So we need inspiration because it's a beginning of something that is exciting. So we need to bring people along and I know it's a talent issue also.

We need to build this talent in this region here and AI is needed because we don't find enough talent. The talent pool is too small for everything we need to build here. So that's why AI already right from the beginning will be a clear enabler. It's not a threat. Nobody has to be worried to lose a job.

We need people and AI in that combination. But the human in the loop, don't forget the people. They take ultimately a decision. It's not AI that takes a decision. So I'm very happy to partner Mark with you with RIQ and the wider ecosystem.

Congratulations. Thank you. Well, to witness this important moment in Abu Dhabi's evolution as global reinsurance market, I would like to welcome to the states his excellency Dr. Sultan Ahmed Al Jabber, UA Minister of Industry and Advanced Technology and Chairman of RiQ and Charles Hatami, senior managing director and global head of financial and strategic investors group at Black Rockck. Yes.

Thank you. You okay?

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