Firstly, can you talk a bit more about the move towards facilitization, please.
ALEXANDER WYLES: Yeah. I mean the drive towards facilitization is really around innovation, it's around product, it's around streamlining, it's around efficiencies, and it's something clients have been asking for from a market which is constantly evolving. So yes, facilities is something we're pushing.
We have got a new facility in IMI, a plus facility, that is product driven. This isn't really something where we're trying to drive price down, it's something where we're trying to, as I said, build in innovation and drive product. So again, we're looking for something that's fit for purpose. Insurers are receptive to that, which is great. Engagement is good.
And it's something that I think was inevitable. And it has been tried and tested. So it's something that's coming back into play and we're supporting that. Markets are supportive of that and clients are obviously benefiting from that as well.
PAUL CLAYTON: Absolutely. OK, perfect. Great answer. Next question. What themes slash risks are you seeing from the client side, and how are these being supported by WTW?
ALEXANDER WYLES: Yeah, so I think there's probably two areas that we're seeing a lot of conversations with clients around. Firstly, you've got cyber risk, which is one of the hot topics. It's pretty topical right now because we've had the CrowdStrike outage. Off the back of that, we've already seen shareholder litigation and customer litigation.
PAUL CLAYTON: Yep.
ALEXANDER WYLES: So again, this is putting an onus on companies and desnos as well around accountability with respect to minimizing system failures and maintaining controls. So yeah, it's a massive focus area. The product innovation driven by WTW alongside that is also, again, focusing on bringing broad cover into place, supporting the client where necessary, and delivering on that theme. So yeah.
I mean, the second thing also, I would say, is the regulatory piece. So we're seeing increased regulatory scrutiny, particularly with respect to the FCA. The FCA brought in consumer duty last year, beginning of last year. Again, more accountability on the D's and O's, having the evidence, and show they are realizing good customer outcomes.
So for both those pieces around the cyber and the regulatory risk scrutiny, I think WTW are engaging, always, with clients. So from a risk optimization perspective, whether it be mapping risk or quantifying that risk and reviewing those coverages, we're working closely with clients. So yeah, I think there's plenty of support from WTW on that basis, and the market is receptive to that.
They are happy to accommodate, to some extent, coverages in those areas that satisfy those exposures. So yeah, all in all, two key areas where we're seeing a lot of discussion.
The third one I'll just chuck in there is on the ESG side and more on the S side, on the social side, particularly around IND. And so it's an area that, again, the regulator has become more focused on and, in turn, clients are having more discussions with us around as well. So yeah.
PAUL CLAYTON: Perfect. Great answer. Thank you. Final and third question on the main question set. On the topic of how the market is sitting at the moment, what are you seeing in terms of rate reductions currently, and what do you estimate the rating environment to look like in the next 6 to 12 months?
ALEXANDER WYLES: Yeah. So I think the rates environment is plateaued for a little bit now. So we're probably, across all lines, looking at flat or about minus 10%. That market is driven through a number of variables. You've got competition from insurers, so you've got plentiful capacity, you've got broker competition, you've got relatively contained claims environment. So I think that that is how we see the current-- how I would see the current environment.
Looking forward to 6 to 12 months, I don't think you're going to see a huge deal of change in that, in all honesty. I think unless we see one of those variables changing a significant amount, whether we see more claims biting or whether we see reduction in insurers or maybe consolidation in insurers or a lack of sustainability around pricing and therefore an impact on appetite, I think we're going to see more of the same over the next 6 to 12 months.
PAUL CLAYTON: OK. Brilliant. No, great answer again. We'll move on to the quickfire question set now. So question one, working in a hard market or a soft market?
ALEXANDER WYLES: Hard market.
PAUL CLAYTON: Brilliant. Next question, pricing or coverage?
ALEXANDER WYLES: I'd say pricing.
PAUL CLAYTON: OK. Next question, slipcase and wet stamps or digital world, i.e. utilizing PPL?
ALEXANDER WYLES: So I think the appropriate answer is PPL and moving digitally. But I think there was something for using the wet stamps and physically going to get the documents stamped in the good old days.
PAUL CLAYTON: Something nice and old school about it, isn't it?
ALEXANDER WYLES: Yeah, the people element of that was still something that was valued, I think. And there still is that. But inevitably, we're going to move. We have. We are moving in the direction of making things more digital.
PAUL CLAYTON: Of course. And we can keep track of PPL stats as well with various markers.
ALEXANDER WYLES: Data-driven.
PAUL CLAYTON: Of course. Next question. Favorite type of industry to work with in terms of the FI role?
ALEXANDER WYLES: Good question. I would probably say banks. Traditionally, the area that I focused on in my previous role. And yeah, I think meeting some of the larger banks always generates interesting conversations.
PAUL CLAYTON: Of course. OK. Great. Thank you. So retaining a difficult renewal or winning a tricky new piece of business?
ALEXANDER WYLES: Winning new business.
PAUL CLAYTON: Yeah.
ALEXANDER WYLES: Always, I would say. Yeah, I think you get the biggest buzz out of winning new accounts. Doesn't matter whether they're small or large, I think being successful in winning a client is probably the most satisfying thing, I would say.
PAUL CLAYTON: Great answer, as always. That's all we got time for today, I'm afraid, but I really appreciate your time. So thank you for popping in.
ALEXANDER WYLES: Thanks, Paul.
PAUL CLAYTON: Thanks, everyone, for watching. We really hope you found that useful. Stay tuned for the next episode of Five Minutes with FINMA. Yeah, we'll hopefully see you again soon.
