Call for greater banking and insurance synergy

The banking and insurance sectors should look at ways to work more closely together in order to help their customers become more resilient, according to Barclays’ managing director of group insurance, Farhad Jamooji.

Speaking as part of Aon’s ‘fireside chats’ series, Jamooji said that the banking and insurance industries each had a “richness” of data that could be utilised as “a way of beginning to forecast certain aspects of risks,” as well as helping to better evaluate “the speed of risk evolution.” He added that banks and insurers working together could help customers to become “as resilient as they can.”

“Ensuring that businesses have access to good risk management and insurance protection, if that helps those businesses then ultimately, as a firm advancing funds, if they are more resilient it actually makes our business more resilient.”

In terms of Barclays’ own risk profile, Jamooji noted that in recent years the bank’s physical asset base had shifted more towards an intellectual one, and that it had developed an effective internal stakeholder engagement process to identify evolving risks within the organisation. He said there remained concerns about the efficacy of insurance contracts, and that the COVID-19 pandemic had highlighted the gaps in “understanding and expectation” between customers and their insurers.

“Partnership as a concept is alive and is typically inherent in the way in which we operate and do business, but at times of stress, there’s a temptation for that partnership to evaporate; it’s actually at times of stress when you really want that partnership to be at its strongest.”
Jamooji said that some customers were demanding a different approach to insurance protection.

“The basis of insurance seems to be very much causation-driven and what I think you are hearing increasingly from customers – whether they’re individuals, SMEs, or large corporates – is they want to be more outcome-driven. It’s a giant step, but I think that’s the kind of thought process that would be helpful as we think about how we can actually make our lives much more relevant to each other.”

Aon says that the aim of its fireside chats is to drive growth across the re/insurance industry in order to bring capital closer to clients’ needs and enable them to flourish in a stronger economy. The series discusses the challenges and opportunities facing major re/insurers and insurance buyers, sharing both perspectives.

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