Macaii S1 E008: Critical Pillars for Stimulating Innovation with Ed Gaze

How will Insurtech continue to reshape the industry in the coming years? What factors, material and psychological, continue to curtail the insurance market from innovating at a steadier pace? In this episode of Changing the Conversation, we are thrilled to be speaking with Insurtech trailblazer Ed Gaze! Whilst Insurtech is having a substantial impact on the wider market and facilitating innovation more broadly, many insurance businesses remain steeped in archaic traditional processes. Ed argues that this, along with considerable red tape around gaining capacity and distribution for new ideas, drains momentum from the market’s efforts to innovate. Ed suggests that businesses that wish to do so must assemble diversely minded teams who share a unanimous passion for experimentation and are motivated by the prospect of trying new ideas and alternative approaches.   Quote of the Episode “I think, generally, we need to get everyone on better data. The better the data, the easier it is to move and change things, and understand what's going on. But the core thing [behind fuelling innovation] is having people [who are] motivated to make change happen and are not motivated to hold back. Sometimes we can be a bit risk averse. Insurers are in the business of risk, but they're also super risk averse. Trying to help them take a bit more measured risk in certain places would be really helpful.” Ed observes that insurers’ attitude towards risk is somewhat oxymoronic – whilst we work to manage and evaluate the risks of our clients, we are very reluctant to take any risks to assist in this process. He notes that while there is a general need across the industry for greater access to and examination/implementation of data, the primary obstacle curtailing innovation is one of attitude.   Key Takeaways The insurance industry is steeped in history, and as such, it is underpinned by an array of seemingly cemented processes. The digital revolution poses a significant challenge to this, as other financial services transition to data-first approaches, so too must insurance. Innovation is also often stymied by a reluctance to justify change. Profitable businesses may see no reason to innovate given their present success, and non-profitable businesses may lack the necessary funds to try something new. As such, for innovation to become more firmly cemented, there needs to be motivation within a given business to pursue change. Ed notes that innovation must be underpinned by a passion for new ideas, a motivation to pursue them, and a no-judgement attitude towards mistakes when they happen. Innovation should be allowed to unfold quickly and fluidly, so that lots of new ideas can be tested and embraced or abandoned in quick succession. It’s key, therefore, to get the right people on board in a business, who are all motivated in the same way. However, Ed highlights that diversity of thought is also crucial with regards to innovation. This can manifest in many different ways – for example, people from different cities or countries may therefore have contrasting life experiences, for example. Alternatively, people who studied radically different subjects at college or university will be equipped with unique skillsets and knowledge. When placed in a team of uniquely minded people, all inspired to innovate, great new ideas and approaches will emerge. Innovation, ultimately, is about applying ideas in new ways that are commercially viable. A diversely minded team will be far more equipped to pursue this end than a room of people who have all vaguely pursued the same path in life. Ed’s long-term vision for the future of insurance is to make it easier for Insurtechs to innovate and for innovative ideas within corporates to be tested. There are considerable roadblocks to quick experimentation of ideas from capacity and distribution. Ed’s fast-paced approach to innovation is underpinned by a desire to learn more – even if an idea fails, so much can be glean