Welcome to Insurance 2020, our series of topical articles for the insurance market. Insurance 2020 pulls together key industry themes for the year ahead and will be delivered to your inbox throughout January and February.  Given the continuing uncertain global economic and political backdrop, 2020 promises to be another dynamic year for the insurance market. It will undoubtedly be a year of great change, driven by substantial M&A activity, enhanced use of technology, more demanding customers and more intrusive regulators.

Following the general election promise to ‘get Brexit done’, Brexit will, of course, continue to dominate, driving further corporate reorganisations and movement out of capital-intensive products. Many insurers have already set up operations in Belgium and Luxembourg in preparation for Brexit, and we will be looking at what’s going on in the Belgian and Luxembourg insurance markets.

Customer needs will be a big theme again this year, with the FCA continuing work on its ‘TCF package’ looking at pricing and distribution, value for money, intergenerational differences, vulnerable customers and a new consumer duty. The first couple of months this year will be busy ones. The FCA’s consultation paper on the new consumer duty is expected imminently as is its final report into pricing practices in the general insurance market. Our Customer Lens article pulls together these themes and looks at what it will all mean for the year ahead.

InsurTech is helping to create a modern agile insurance market which can respond rapidly to change, be it Brexit or rapidly changing customer needs. The Lloyd’s market is entering a new chapter with its Blueprint One action plan as it seeks to lead the insurance industry into the next generation.  We will explore these technological advancements in our InsurTech and Lloyd’s articles

While technological advancement is regarded as essential by many, regulators across Europe are becoming increasingly concerned about the changing operational risks this poses and their potential impact on the stability of the EU financial markets. ‘Operational resilience’ promises to be the phrase on everyone’s lips as we all continue to digest the raft of materials being produced by UK and European regulators.  Insurers find themselves having to grapple with different requirements on the same themes, each with a different scope, implementation dates and supervisory approaches.  It will certainly be a challenge to piece together the regulatory landscape as it develops in the year ahead.  Our ‘Operational Resilience to Recovery and Resolution’ article will look at all this in more detail.

No insurance series would be complete without an article on climate change.  Climate change has long been recognised by insurers as a key emerging risk and the industry now finds itself at the forefront of dealing with the impact of this issue of global importance.  The insurance market is one of the world’s biggest institutional investors and insurance investment in low/no-carbon technologies is becoming more common.  Steps are also being taken to help to minimise future climate change-related losses and to ensure affordable insurance cover in years to come. Our Climate Change article will look at the challenges the industry faces.

The debate around Open Finance and putting customers in control of their data will move forward at great speed this year. The FCA is looking closely at how to foster an environment of healthy competition which has the right balance of consumer protection and encouragement of technological innovation and has just issued a ‘call for input’ which closes in March.  Our first article Keeping an Eye on the Competition looks at regulatory scrutiny of competition in the insurance sector in more depth.  We will be sending this out later this week.  We really hope that you enjoy reading it and the articles that follow.