Thank you for your kind welcome.
I want to begin by thanking today’s conference partners KPMG, whose support and expertise has once again ensured we are able to deliver a varied and high-quality programme.
I also want to thank today’s exhibitors – Avanade; Board; Citrix; DAC Beachcroft; Medical Solutions; Moneypenny; Insurance United Against Dementia; the Insurance Charities and Link – the LGBT Insurance network. If you haven’t already done so this morning, please visit their stands to learn more about their work and the contribution they all make to our sector.
For this year’s conference, we have looked to make the breakout sessions more inter-active, to allow you to contribute and to reflect the wide scope of issues we work on – which include a range of constructive relationships with nine Government departments, three devolved Governments and regulators in the UK and internationally.
The ABI’s purpose is to provide Strength Through Association – which comes from the contributions made by over 200 member firms, Platform Members and Associate Members - to our policy and advocacy work.
A testament to that work is the fact that today’s conference was over-subscribed.
Just remember, when you are queuing for coffee later on that you are the lucky ones!
So I am pleased to welcome you all today.
When I had the privilege of taking over from Amanda Blanc as chair of the ABI, I was clear that I wanted to continue her focus on the long-term, strategic challenges facing our sector.
As the new Government looks to set the agenda for the British economy outside the EU, there has never been a more interesting – but also more challenging – time to be part of our industry.
Before I introduce our first keynote speaker, I want to focus on those challenges –where we need to come together with one voice and ensure the Insurance and Long-Term Savings sector is able to meet our objective of Helping Britain Thrive.
Our first priority as a sector will always be responding swiftly when our consumers need us most.
As we meet for this conference, many of our customers are still dealing with the aftermath of the recent storms and floods.
We estimate the total cost of November’s flooding will be £132.2m, which included over £1.5m in immediate emergency payments and placing 248 households in alternative accommodation.
Similar action from insurers on the ground has been needed for Storms Ciara and Dennis this month.
I am especially conscious that, as we gather here today, many thousands of our customers are currently out of their homes or are seeing their businesses disrupted as a result of the recent storms.
I know I can speak for all the firms represented by the ABI when I say that we are committed to round the clock work with our partners to help those affected – including working closely with the Environment Agency.
Successive Governments have failed to keep pace with the levels of flood defence spending that we need.
We need to take a multi-decade approach and we are calling for an increase in flood defence investment to at least £1.2billion a year for the next spending review and potentially significantly beyond.
This could halve the number of properties at high and medium risk. Every £1 spent can save £9 in property damage and disruption. It’s a false economy not to act now.
Alongside this, we also need to ensure there is no further inappropriate development in flood risk areas and install property level resilience to make properties more resilient. Although there is a clear need for more affordable homes, it is short-sighted to build these in areas of high flood risk or where they may cause flooding problems for neighbouring properties.
The insurance industry remains committed to this through subsidising the flood re scheme that has helped an extra 300,000 households access more affordable flood insurance.
Incidents like this demonstrate the importance of our industry, but also show that we must keep working to ensure everyone has access to affordable insurance that meets their needs.
This is why the ABI has called on the Government to reduce the rate of Insurance Premium Tax in next month’s Budget, so all consumers and businesses can afford the insurance they need.
Even before the recent floods, we have seen the issue of climate change rise further up the political and regulatory agenda – as the UK Government prepares to host COP26 in November.
That is why this morning we will hear from leading environmentalist Tony Juniper, who will outline the nature of the threat and what the demands on business will be in addressing it.
Few parts of the global economy have a bigger stake in tackling climate change than insurance and long-term savings. As providers of cover to households and businesses, our industry is uniquely exposed to the immediate costs of failing to address climate change. However, in the longer term, as risk managers and as institutional investors, we have the capacity to shape our future energy provision and reduce the risk we face.
With regulators placing clearer demands on the sector – we know that we will face growing scrutiny in both of these areas.
Sustained action on climate change requires working in partnership across the economy – investing in the infrastructure that will make homes and businesses more resilient.
The second strategic challenge on today’s agenda is the role of consumer data, vital for insurers and long-term savings providers alike. As with climate change, we have known for some time that this has the potential to reshape our sector’s role in the economy.
And - also like climate change – in the last 12 months, external focus on this issue has sharpened – with the Government’s Smart Data agenda and the FCA’s work on Open Finance.
The starting point for any discussion of data has to be a better understanding of what consumers think –
So, today, we will be publishing the outcome of an extensive research project, conducted with Britain Thinks.
We will have the opportunity to digest the research in full later – I doubt it will surprise many people in the room that the findings paint a complex picture. Consumers do have concerns about how their data might be used, but there is also a demand from many consumers for the more personalised framework that richer datasets can deliver.
Projects like the Pensions Dashboard show the potential of smarter data to increase consumer engagement – but we must take consumers with us as we innovate.
This takes me on to the third challenge I want to touch on – the Ageing Society.
Whether it comes to funding social care and managing long-term health conditions or meeting the needs of people as they save for retirement - our sector is at the centre of meeting this challenge.
A key aspect is ensuring the previous reforms to the UK pension system work as intended – so, today we are publishing two reports and aiming to start a discussion on improving the safeguards and support that underpin the Pension Freedom and Choice reforms.
With £6.8bn withdrawn from pensions annually, we must make sure the system works as intended and gives savers adequate advice and safeguards.
Before closing, I wanted to highlight a few other areas that are ‘front of mind’ for the ABI Board – which include meaningful action on Diversity & Inclusion and engaging with the new Government’s legislative agenda.
On Diversity & Inclusion, we know that there has been progress but our sector is still not inclusive enough.
So, our focus now turns to moving the dial – last year, the ABI launched new commitments to provide transparency on parental leave and, this year, we will be working to launch an industry-wide Jobshare Portal.
This is just one of the reputational challenges that will be covered in detail in our first panel session.
Work on these long-term challenges has continued amidst the turbulent political environment of the past few years – Our next speaker, Chris Mason will give you his view on this shortly
As the ABI’s Director General Huw Evans said in his speech to our Annual Dinner last night – we now have a Government with a decisive majority and the scope to carry through change.
This represents a real opportunity for our sector – now, we must invest the time and resources needed to ‘lean-in’ to public policy making – helping the Government with ambitious – but evidence-based – solutions.
That also means remaining engaged in the negotiations on the UK’s future relationship with the EU.
We have been clear for some time that a relationship that doesn’t give the UK – Europe’s largest insurance market and the fourth largest in the world – the scope to set its own regulatory framework will be unacceptable.
As an industry, we have taken the steps we need to prepare for Brexit – transferring 29million contracts and newly establishing over 30 EU branches.
We will always want a close and constructive partnership with European insurance markets.
Now, the Government’s focus must be on tackling those aspects of the regulatory framework that limit our scope to invest in the economy and innovate to meet the needs of our customers.
So – some significant issues to cover over the course of the day and to focus on in the year ahead. I give you my commitment, on behalf of the ABI Board, of our focus and engagement on these challenges.
I am confident that we have a trade association equipped to tackle these challenges – in 2019, the ABI received its highest ever satisfaction ratings and it has the staff and resources to make a meaningful impact into the new decade.
I hope you enjoy the conference and that today’s discussions leave you feeling better prepared to maximise our industry’s role in shaping the response to these challenges.