Virtual trading

Make room for the future

Carol Baker, Head of Customer Proposition, at Liberty Specialty Markets explains how they developed Liberty Virtual Rooms with the customer firmly in mind.

The impact of new technology continues to fascinate, never more so than during the pandemic when it is playing a central role in our daily working lives. Designed and implemented intelligently, digital technology has the power to radically reshape the interaction between a customer and a commercial organisation. That’s the key to making these advances work: putting the customer firmly at the heart of technological innovation.

Over the years, we’ve seen countless technology initiatives come and go in the London Market – initiatives that worked perfectly on a whiteboard but, when exposed to the scrutiny of brokers and clients, collapsed under the weight of questions and exceptions.

The advent of COVID-19 proved to be a huge impetus for the adoption and creation of new technology. As normal working patterns were disrupted and the ability to meet face-to-face was hugely restricted, market businesses turned to technology. This was evidenced by the very dramatic increase in the use of e-trading early in the first UK lockdown, when the Lloyd’s underwriting room was closed for the first time.

Underwriters worked long hours across every conceivable communications channel to keep the wheels turning. But very quickly it became apparent that without regular face-to-face broker meetings, or chance encounters in Lloyd’s, broking lounges or coffee shops unique to the London Market environment, it would be challenging to maintain business as usual. Brokers were reporting it had been taking up to four times as long to place a risk at the height of the pandemic restrictions.  Video conference calls dominated standard working hours and email traffic soared. Many resorted to WhatsApp messages just to get on the radar and schedule the conversations which are so essential to getting risks written. Something had to be done.

The concept that gained most favour around the market was the idea of a virtual underwriting room – a route which Liberty Specialty Markets (LSM) has explored as well as Lloyd’s under Blueprint Two.

LSM’s first steps toward virtual collaboration were taken some years ago when we decided to modernise our risk engineering function. Traditionally, risk engineering’s approach has been focused on physical exposures rather than client relationships.  The role of a risk engineer was to write technical reports to explain to a client how they could mitigate risks by making changes. Little proactive support was offered beyond scheduled visits, and there were few extra tools and services to help the client.

Our goal was for the customer to see risk engineering as a service provided in consultation with the broker.  We analysed engineers’ working methods, how they interacted with clients and brokers and assessed where technology could be deployed to create improvements in the client interaction.  The solution was to create a portal to act as a digital home for services and tools. This created two benefits: first, it provided direct access for brokers and clients to risk engineering resources; two, it freed time for our risk engineers to focus more on adding value with the client.

The need for a physical visit to a client’s site was also reviewed. Historically, a visit was deemed necessary, but in today’s world of high-speed broadband and lightweight video cameras, and with COVID-19 distancing restrictions, the risk engineer can watch while someone at the client facility walks the site following the engineer’s instructions, capturing images and details.

It was the lessons we learned during this process that shaped our approach to our virtual room project this summer.  Liberty Virtual Rooms was first trialled in August. By September, it was supporting 250 meetings with pilot broker partners enabling a total of 695 participants to have over 22,000 minutes of discussion. By October, we were up to 605 meetings, 900 participants, 53,000 minutes of face-to-face discussions. November saw another increase as well as more engagement for internal meetings.

Initially seen as a way to share availability during movement restrictions imposed by the COVID-19 lockdown in the early phase of the pandemic, Virtual Rooms is here to stay because it enables us to connect more readily. If brokers can see that an underwriter is not available straight away, they can simply book a date in the future.  They are able to record a video message, which saves them having to compose an email and leaves matters less open to interpretation as users can see the visual cues and tone as well as listen to the spoken message.

While Virtual Rooms is not intended to replace traditional face-to-face contact, it is a convenient and effective way to continue to do business when diaries don’t align, or office days don’t coincide. As we move to a hybrid working model, the axes shift to aligning where we meet, as well as when we are available – office, home and Lloyd’s.

‘If you build it, they will come,’ said Kevin Costner in the film Field of Dreams. But that’s not always the case, as any underperforming technology initiative will tell you. It’s only by starting with the customer and then building out from their needs that new technology stops being a gizmo and starts being a valuable tool. Virtual rooms like the one we’ve built have huge potential. We’ve not seen the last of them and many will fall by the wayside. The ones that succeed will succeed because the customers – our broker partners – value them.