Buying technology from a vendor is common across the insurance industry - but that doesn't mean you're transferring the risk. In this Risk Desk special, experts explain what you must be aware of.
00:01 - Paul Lucas:
When UK insurers and brokers buy technology from a vendor, many assume they're transferring the risk that comes with it. The regulator disagrees, and so do the people building the systems. Well, you can outsource capability, but you can't outsource the accountability. You know, so from a regulatory perspective, that very much sits with us. Under the FCA's senior managers and certification regime, that accountability is personal, named on the record, and not
00:32
transferable to a vendor contract. So, how do you decide what to build and what to buy? When relying on vendors for us will be sort of commodity infrastructure, cloud hosting, CRM tools, standard communication rails, anything that sort of it doesn't really involve our sort of core IP. If we buy the utilities, but we sort of build our soul as a business. The competitive risk of getting that balance wrong is one Dagnal is direct about. Everyone's relying on a vendors, and
01:02
that's their IP, then someone at some point will do it better. The vendors you choose shape your capability, but what they do in your name stays your responsibility. For more from our digital transformation leaders network, check out the full round table now at Insurance Business TV.
