The recent World Insurance Congress Australia (WICA) in Melbourne, was a conference organised by insurance law professionals but its focus was very heavily on issues impacting the industry at large.
Insurance Business asked conference chair Angus Kench (pictured), who is a board member of the Australian Insurance Law Association (AILA), if this inclusive approach was more deliberate at their Melbourne event than at previous WICAs?
“AILA [one of the organisers] has always sought to provide education and networking opportunities for everyone in the insurance industry,” said Kench, who is also Liberty Specialty Markets vice president of casualty, workers’ comp and crisis management claims in the Asia-Pacific.
The question of whether insurance lawyers – like members of AILA – are more insurance professionals or lawyers, could be existential.
“We have often had conversations about the word ‘law’ in our name,” he said. “Given the ‘law’ is at the core of many decisions and indeed the framework of insurance, we leverage our connections and thought leaders to bring education to insurance.”
Kench does seem to be more of a lawyer.
“I guess you could say ‘law’ is in our DNA, but it’s not just legal issues we discuss,” he said.
WICA’s program, said Kench, was built around “four critical topics of enormous relevance and importance to the insurance industry.”
The topics: conflict, climate, innovation (including careers) and ESG [environmental, social and governance], involved speakers and panel discussions with a mix of lawyers, underwriters, claims specialists, brokers, academics, actuaries and other insurance professionals.
Brokers attending WICA said the first working party, “Climate and Catastrophic Events,” was particularly interesting.
The opening speaker was the University of Melbourne’s Rebekkah Markey-Towler, a climate law and climate change litigation expert. Her talk covered climate related litigation risks for insurers from an Australia-Pacific perspective including threats to collaborative insurer action and how climate issues could increase premiums.
One broker said takeaway points included the need for insurers and other industry stakeholders to work together to transition towards a net zero economy “sooner rather than later”.
This view was echoed by other climate experts this week during the Climate Ambition Summit in New York. The summit was attended by world leaders, including Australia’s government. As the meeting got underway, the Australian Academy of Technological Sciences and Engineering (ATSE) called on the Federal Government to commit to net zero greenhouse gas emissions by 2035, not 2050 as pledged.
Markey-Towler also discussed climate-related litigation cases in Australia and how some are now involving disputes brought by citizens motivated by climate concerns.
Brokers who talked to IB also said “War and Conflict. The International Security Outlook and insurance implications,” was a compelling session.
One of the panellists, Jesse McNeilly, a former Australian Army Paratrooper, was recently in Ukraine where he provided military training for civilians. He shared videos from the training sessions. One showed a group of people, including local farmers, in a field all kitted up in army gear. When McNeilly said to them: “People are there to kill you,” one broker said it really brought home the sad reality of war.
Other images McNeilly showed of destroyed apartment buildings, said the broker, “put shivers up your spine.”
The panel discussed issues around insurance coverages during wartime and what constitutes an exclusion. One particular issue, according to industry stakeholders in war insurance, is defining a war event.
Rob Merkin, a professor of commercial law from the UK’s University of Reading, provided an example of how difficult that can be. Merkin discussed the discovery in 2021 of an unexploded World War II bomb on private land next to the University of Exeter.
According to a BBC News report, after the area was evacuated, a bomb disposal team destroyed the device in a 400-tonne "box" of sand. The explosion, according to the report, was heard up to 8km away and left a crater that could fit three double decker buses.
The explosion, according to Merkin, took out some of the university including windows. He said the case is currently before the court on appeal and one big insurance question concerns if the explosion that caused the damage can be considered a war event, or if the explosion was caused by the act of activating the bomb?
Discussion around this insurance issue, said Merkin, concerned the proximate cause of the explosion and whether it was the defusing of the bomb, in which case it wouldn’t be an exclusion. Or, he said, if the proximate cause was that it was dropped by the Germans in the 1940s as an act of war, so therefore it would be excluded.
A panel of American experts discussed the implications of artificial intelligence (AI). A broker who watched the session said one of the experts provided shock value by dramatically stating that AI will likely take all insurance and legal jobs in the future.
However, the expert suggested that this threat can be turned to the industry’s advantage. For example, brokers can focus on advising their clients rather than routine admin like inputting data.
ESG was also a major WICA focus area. One concern raised during this session was how some American states are strongly resisting ESG legislation and policies by enacting anti-ESG laws.
A recent post on the Harvard Law School Forum on Corporate Governance confirms the level of anti-ESG feeling.
“The backlash against ESG in the United States has been unmistakable in 2023,” said a Forum post in August. “More than one-third of states have passed anti-ESG laws in 2023, most ESG-related shareholder proposals failed to garner majority support, new lawsuits have been filed challenging companies’ ESG-related activities and decisions, and some companies seem to be distancing themselves from the term “ESG” itself.”
Kench said more than 350 delegates representing more than 20 countries attended WICA.
“The congress was a great success,” he said. About 60% of the attendees were from the wider industry, the rest, said Kench, were insurance lawyers.
Did you attend WICA in Melbourne? What was your favourite session? Please tell us below