How Travelers sees digital helping middle-market

May 24, 2022

Originally published in Digital Insurance

Digital Insurance spoke with Scott Higgins, executive vice president and president of middle-market and national property, business insurance field for Travelers, about trends impacting the middle market and the role of insurtechs. Travelers defines this segment as businesses with 50 to 1,000 employees.

The following responses have been lightly edited for clarity.

What's your role at Travelers?

The entirety of my career has been at Travelers. It will be 31 years in June. I’m responsible for what we call our middle-market segment, as well as our national property segment.

I also run our business insurance field organization. Middle market and national property make up about $11 billion or so, in revenue. And then, the field responsibility is executed across 10 different regions around the country.

I spent a lot of time in field organization, starting as an underwriter and then making my way up through various leadership levels working with agents, brokers and customers.

Then, a significant part of my career was technical underwriting, serving as a chief underwriter for several divisions. My skill set falls into underwriting distribution.

How is your segment working with insurtechs?

We are fairly close to insurtechs that are disrupting and enabling the industry. The insurtechs are creating a dynamic, where for the first time, someone outside the industry is scrutinizing it. We are paying attention and it makes us stronger.

There are insurtechs out there that can scrape data and convert it into a format that can be rendered universally into our system. If there is a new customer opportunity for us and we’re looking at losses, traditionally that would be printed out information from another carrier and rekeyed into our systems. So, what would have taken days is now taking hours. It’s things like that that are appealing to underwriters.

Thinking about the traditional way of doing business in a much more efficient way, that’s what digital means to me.

What are some of the key issues in the middle market that digital can address?

1. The first thing that comes to mind is distributor consolidation. It’s probably not going to slow down. Our agents and brokers are continuing to join forces, merging and acquiring in the short term. That has been a bit of a non-event given the size of Travelers.

I think in the longer term it serves us well in that distributors come together for a reason and one of those is to become more efficient in their organizations. I know they’re looking for carriers that can do the same. We want to be the most efficient insurance carrier to do business with. Consolidation is an opportunity to take advantage of.

2. Digital is a common term that is used in this marketplace and for us, it means a lot of things. Top of mind is the degree to which we exchange information and interact with our training partners, which can be done faster with digital. In our space, we fundamentally exchange information with our partners and there are opportunities to do that better. That’s a big part of what the digital environment can change.

We embrace that opportunity where we can be a leader in that space. It can take all forms and fashions, whether it’s communicating appetite or marketing collateral or how you exchange loss information when you’re considering a new opportunity.

3. Supply chain challenges have impacted our customers and Travelers in a meaningful way. We’ve been able to help with consultative services. It’s not insurance in a traditional manner but rather what you can do for a customer in terms of offering counsel.

It seems like old news now but there was a time early in the COVID-19 pandemic when customers were changing their operations and asking for help. Surgical gown producers were making masks because they were needed, hotels were acting as quarantine shelters and winemakers were making sanitizers–customers wanted to do the right thing. Their exposure was changing though and we were able to provide help in that area.

What does the future hold for this segment post-pandemic?

Middle market is a significant part of the economy and it’s changing dramatically. We think about the forces of change a lot and changing consumer expectations, people expect an Amazon experience. That changing dynamic we’re seeing on the consumer side is also taking place on the commercial side.

This is a renaissance period for technology and we have to be a part of the conversation. For example, the ability to take data and aggregate it in a way where you can make meaningful, thoughtful decisions that’s what we’re going through. Distribution is also changing. A higher percentage of our business is coming from fewer distributors and so as that happens, it forces us to think a little bit differently as well. It’s an exciting period for us at the company.

We talk a lot about performing and transforming. The two used to be separated but now it’s to the point where our ability to perform is inextricably linked with our ability to transform.

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