--- title: "Innovation: Dangerous or Essential?" description: "Innovation: Dangerous or Essential? - Without innovation, underwriters ARE destined for increasing irrelevancy." --- [![InsitePro Logo](https://www.goinsitepro.com/hs-fs/hubfs/InsiteProGlobe-with-text-web-2.png?width=500&name=InsiteProGlobe-with-text-web-2.png "InsitePro Logo")](https://www.goinsitepro.com/) [![InsitePro Logo](https://www.goinsitepro.com/hs-fs/hubfs/insitepro_2018/images/InsitePro4%20(1).png?width=500&name=InsitePro4%20(1).png "InsitePro Logo")](https://www.goinsitepro.com/) [Contact Us](http://www-goinsitepro-com.sandbox.hs-sites.com/contact-us) | [+1 877-837-7246](tel:+1%20877-837-7246) - [Why InsitePro](https://www.goinsitepro.com/why-insitepro) - [Flood](https://www.goinsitepro.com/flood-insurance) - [Wildfire](https://www.goinsitepro.com/wildfire-insurance) - [Retail Agents](https://www.goinsitepro.com/retail-agents) - [About](https://www.goinsitepro.com/about-intermap) - [Blog](https://www.goinsitepro.com/blog) ## Innovation: Dangerous or Essential? Posted at Nov 29, 2016 8:00:00 AM by [Ivan P. Maddox](https://www.goinsitepro.com/blog/author/ivan-p-maddox) - [Tweet](https://twitter.com/share) Did anyone reading the [Intelligent Insurer](http://www.intelligentinsurer.com/) last week notice their *Most Read* highlights? Here it is from November 15: ![Editors pick - blog.png](https://www.goinsitepro.com/hs-fs/hubfs/Risks%20of%20Hazard%20Blog%20Posts/Editors%20pick%20-%20blog.png?width=265&name=Editors%20pick%20-%20blog.png) I don’t know if it was intentional or not, but they made a perfect microcosm of an interesting and important debate resounding through the corridors of insurance conventions. Both articles are behind the subscription wall (to which I don’t have a key), but the blurbs illustrate the point brilliantly. [The first article](http://www.intelligentinsurer.com/news/insurers-should-be-wary-of-innovation-deutsche-r-ck-10298) is from an interview with Arno Junke, CEO of Deutsche Rück, and he cautions against becoming “obsessed with developing new products driven by technology and fears of competition from new entrants.” Meanwhile in the [second article](http://www.intelligentinsurer.com/news/insurers-in-danger-of-becoming-plain-risk-carriers-in-insurtech-race-hiscox-coo-warns-10288), Florence Tondu-Melique - European COO of Hiscox, cautions that “digitally-focused new players in the insurance industry are increasingly threatening the market dominance of traditional insurers in a dynamic that could ultimately force the incumbent players to become nothing more than risk carriers.” What is an underwriter looking to get ahead to make of this? If they shy away from innovation, does irrelevancy await? Or will innovation be a distraction, reducing the focus on the core business of turning risk into premium? For the first time in this blog, the answer comes from Oscar Wilde. ![Oscar Wilde - Blog.jpg](https://www.goinsitepro.com/hs-fs/hubfs/Risks%20of%20Hazard%20Blog%20Posts/Oscar%20Wilde%20-%20Blog.jpg?width=302&name=Oscar%20Wilde%20-%20Blog.jpg)Without innovation, underwriters ARE destined for increasing irrelevancy. There is immense opportunity to grow premium (see [the protection gap](https://www.goinsitepro.com/risks-of-hazard-blog/2016/08/a-homeowners-view-of-the-protection-gap), [US flood](https://www.goinsitepro.com/risks-of-hazard-blog/2016/09/not-just-private-flood-universal-flood), [US earthquake](https://www.goinsitepro.com/risks-of-hazard-blog/2015/08/new-madrid-fault-line-concerns), [Canada flood](https://www.goinsitepro.com/risks-of-hazard-blog/2015/11/flood-insurance-is-coming-to-canada), etc.), and the winners and losers will be decided on how well underwriters innovate their underwriting to exploit it. However, innovation is not alchemy. No amount of technology or creativity will change the way underwriting works – in the end, risk needs to be converted to premium and the underwriters who do that best (i.e. most efficiently, most actuarially sound, etc.) will always be successful. Thus, innovation is needed, but it needs to be moderated. But that moderation should not be overstated. The best article I’ve seen that explores this fine balance is from [Nick Lamparelli](https://insnerds.com/author/nick-lamparelli/) over at insnerds.com, taking a look at [Lemonade](https://insnerds.com/lemonade-hype/). In a nutshell, technological and business innovation is a way to improve insurance but it is NOT a way to change how insurance works (regardless of how it’s pitched). Changing how insurance works will require the creation of an entirely new industry, not the incremental alteration ([or even disruption](https://www.goinsitepro.com/risks-of-hazard-blog/2015/10/pardon-the-interruption-of-the-disruption)) of the existing one. Confusing? A little bit. Accurate? Yes. But no more confusing or accurate than the very definition of insurance I recently heard over a drink with a friend from London: insurance is the business of paying claims. Well said, everyone.   Topics: [Flood Insurance](https://www.goinsitepro.com/blog/topic/flood-insurance), [Insurance Protection Gap](https://www.goinsitepro.com/blog/topic/insurance-protection-gap), [Flood Modeling](https://www.goinsitepro.com/blog/topic/flood-modeling), [Flood Risk](https://www.goinsitepro.com/blog/topic/flood-risk), [Floods](https://www.goinsitepro.com/blog/topic/floods), [Private Flood](https://www.goinsitepro.com/blog/topic/private-flood) ### Comment Form ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?width=280&name=sidebar-bg.jpg "sidebar-bg") # The Risks of Hazard Blog Welcome to The Risks of Hazard, brought to you by Intermap Technology. From the latest industry news and trends, to insight from thought leaders around the globe, stay tuned for a variety of content aimed at helping you better understand the role of location-based intelligence in the world of insurance underwriting and risk assessment. ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?width=280&name=sidebar-bg.jpg "sidebar-bg") ### Subscribe to the Risks of Hazard blog! ![sidebar-bg](https://www.goinsitepro.com/hs-fs/hubfs/sidebar-bg.jpg?t=1539078502257&width=280&name=sidebar-bg.jpg "sidebar-bg") ### Posts by Tag - [Flood Insurance (60)](https://www.goinsitepro.com/blog/tag/flood-insurance) - [Insurance Underwriting (60)](https://www.goinsitepro.com/blog/tag/insurance-underwriting) - [Risk Management (41)](https://www.goinsitepro.com/blog/tag/risk-management) - [Flood Risk (39)](https://www.goinsitepro.com/blog/tag/flood-risk) - [Insurance Protection Gap (29)](https://www.goinsitepro.com/blog/tag/insurance-protection-gap) - [Flood Modeling (27)](https://www.goinsitepro.com/blog/tag/flood-modeling) - [Property Insurance (26)](https://www.goinsitepro.com/blog/tag/property-insurance) - [Natural Catastrophe (25)](https://www.goinsitepro.com/blog/tag/natural-catastrophe) - [Natural Hazard Risk (25)](https://www.goinsitepro.com/blog/tag/natural-hazard-risk) - [Private Flood (25)](https://www.goinsitepro.com/blog/tag/private-flood) - [InsitePro (21)](https://www.goinsitepro.com/blog/tag/insitepro) - [Floods (19)](https://www.goinsitepro.com/blog/tag/floods) - [Insurance Technology (17)](https://www.goinsitepro.com/blog/tag/insurance-technology) - [Wildfire (17)](https://www.goinsitepro.com/blog/tag/wildfire) - [Insurance Software (16)](https://www.goinsitepro.com/blog/tag/insurance-software) - [Risk Scoring (14)](https://www.goinsitepro.com/blog/tag/risk-scoring) - [Effective Underwriting (13)](https://www.goinsitepro.com/blog/tag/effective-underwriting) - [Earthquake (12)](https://www.goinsitepro.com/blog/tag/earthquake) - [Other Risk Models (11)](https://www.goinsitepro.com/blog/tag/other-risk-models) - [NFIP (10)](https://www.goinsitepro.com/blog/tag/nfip) - [Risk Models (8)](https://www.goinsitepro.com/blog/tag/risk-models) - [Hurricane (7)](https://www.goinsitepro.com/blog/tag/hurricane) - [Houston (6)](https://www.goinsitepro.com/blog/tag/houston) - [Big Data (5)](https://www.goinsitepro.com/blog/tag/big-data) - [Flood News (5)](https://www.goinsitepro.com/blog/tag/flood-news) - [Innovation in Insurance (5)](https://www.goinsitepro.com/blog/tag/innovation-in-insurance) - [Insurance News (5)](https://www.goinsitepro.com/blog/tag/insurance-news) - [Cloud Computing (4)](https://www.goinsitepro.com/blog/tag/cloud-computing) - [Hail (4)](https://www.goinsitepro.com/blog/tag/hail) - [Underwriting Profit (4)](https://www.goinsitepro.com/blog/tag/underwriting-profit) - [FEMA (3)](https://www.goinsitepro.com/blog/tag/fema) - [Insurance Disruption (3)](https://www.goinsitepro.com/blog/tag/insurance-disruption) - [Location-Based Intelligence (3)](https://www.goinsitepro.com/blog/tag/location-based-intelligence) - [Terrain Data (3)](https://www.goinsitepro.com/blog/tag/terrain-data) - [Analytics (2)](https://www.goinsitepro.com/blog/tag/analytics) - [Blogs (2)](https://www.goinsitepro.com/blog/tag/blogs) - [California (2)](https://www.goinsitepro.com/blog/tag/california) - [Fire Insurance (2)](https://www.goinsitepro.com/blog/tag/fire-insurance) - [Geocoding (2)](https://www.goinsitepro.com/blog/tag/geocoding) - [Agreement (1)](https://www.goinsitepro.com/blog/tag/agreement) - [Canada Flood Risk (1)](https://www.goinsitepro.com/blog/tag/canada-flood-risk) - [Conference (1)](https://www.goinsitepro.com/blog/tag/conference) - [Coverholders (1)](https://www.goinsitepro.com/blog/tag/coverholders) - [Data Management (1)](https://www.goinsitepro.com/blog/tag/data-management) - [Data and Models (1)](https://www.goinsitepro.com/blog/tag/data-and-models) - [GAO (1)](https://www.goinsitepro.com/blog/tag/gao) - [Global Flood Map (1)](https://www.goinsitepro.com/blog/tag/global-flood-map) - [Government (1)](https://www.goinsitepro.com/blog/tag/government) - [Inside Intermap (1)](https://www.goinsitepro.com/blog/tag/inside-intermap) - [Pipeline Operations (1)](https://www.goinsitepro.com/blog/tag/pipeline-operations) - [Survey (1)](https://www.goinsitepro.com/blog/tag/survey) - [Technologies (1)](https://www.goinsitepro.com/blog/tag/technologies) - [Top Ten (1)](https://www.goinsitepro.com/blog/tag/top-ten) - [Top Three (1)](https://www.goinsitepro.com/blog/tag/top-three) see all [![InsiteProGlobe-with-text-web-1](https://www.goinsitepro.com/hs-fs/hubfs/InsiteProGlobe-with-text-web-1.png?width=1062&name=InsiteProGlobe-with-text-web-1.png "InsiteProGlobe-with-text-web-1")](https://www.goinsitepro.com/) ©2026 Intermap Technologies®. All rights reserved. - [Legal](https://www.goinsitepro.com/intermap-legal-information) - [Disclaimer](https://www.goinsitepro.com/disclaimer) - [Terms of Use](https://www.goinsitepro.com/intermap.com-terms-of-use)