Lloyds boss warns insurers of the risk of being ‘Uber-ised'

With a large array of companies, from Walmart to Google, poised to step into the insurance market, the chief executive of Lloyds of London has warned insurers to prepare to be ‘Uber-ised’.

Inga Beale told attendees of the Financial Times’ Future of Insurance Conference that big data analysis threatens to disrupt the insurance industry in the same way the taxi sector has been shaken up by the introduction of Uber.

Beale, who heads up the 325-year-old insurance market,  claims that companies with vast quantities of data to hand, such as supermarkets and social networks, could diversify their offerings by selling mainstream retail and wholesale policies in as soon as one or two years.

She adds that although steps have already been made by insurers to collect data from consumers, through such things as telematics for usage-based insurance, there is still an anxiety among insurers when straying away from traditional business practices.

Beale said that non-specialist insurers will be particularly vulnerable to the industry-wide changes technology will bring about.

“We need to focus on covering the complex, bespoke and innovative risks that no one else can — because the less complex risks are going to become commoditised pretty fast,” she said.

“We have already seen the impact of better data and new platforms in motor insurance. Insurers will be Uber-ised unless we find new ways to add value.”