Duck Creek CEO Formations Keynote: Working to Simplify Insurance

Mike Jackowski, CEO, Duck Creek talked about challenges such as climate change and macroeconomic forces, and the combined challenge and opportunity of GenAI and other tech disruption.

(Duck Creek CEO Mike Jackowski speaking at the company’s Formation 2024 user group meeting.)

“What does it mean to be simplifying within our industry,” asked Mike Jackowski, CEO, Duck Creek Technologies, during his keynote address at the company’s Formation’s 2024 user group meeting in Dallas on May 22 themed, “Simplifying Together.” Jackowski alluded to simplification efforts commonly going wrong and noted the complexity of the insurance value chain, its distribution system and its regulatory environment.

Jackowski then set the stage by describing what technology has done to shape contemporary life, from the astonishing availability of information through Google, to rideshare and autonomous taxi transportation. “Simplification doesn’t need to be that profound,” he said. “We can simplify a smaller, tighter or a really important process.”

The insurance industry must manage overwhelming complexity, and it can be a struggle to navigate its challenges, but the industry is at an inflection point, Jackowski opined. Speaking of his own immersion in Generative AI, he noted insurance’s essential informational character and said, “the responsible use of all the data we’ve amassed, and the application of this technology is going to be our moment to catch up and springboard across the industry.”

In undertaking its own contribution to simplifying insurance, Duck Creek relies on its partner ecosystem to tackle various aspects of industry complexity, Jackowski said. “We work with over a hundred solution partners. They have so many clever solutions that are out there. They’re taking on some really complex parts of the value chain.”

“In order for us to be successful and to meet your expectations, we have to successfully integrate Duck Creek and all these partners into your backplane and into your business operations,” Jackowski continued. “That’s why we’re very proud to work with the industry’s best. We work with over twenty leading systems integration partners. They have expertise in insurance, and in change management, and project management to get things right. We have these top-flight consulting partners here that have expertise on data conversion and project management and some things unique things that you need.”

Climate Change

Management of changing technology happens within a larger set of forces at play, Jackowski implied. “There are some unnerving macro forces that are hammering the industry, and I’m going to start with climate change,” he said, noting that global catastrophe (CAT) losses totaled about $275 billion, with over $175 billion of those losses being uninsured.

Sharing data from Swiss Re, Jackowski noted a jump in catastrophe losses more than doubling within a ten-year period. “Climate change is real,” he said. “It is impacting our business.”

Jackwoski went on to note that 2023 saw 30 medium-sized disasters, as identified by Swiss Re as causing between $1 billion and $5 billion in losses.

“I want you to think Maui wildfires, tornadoes, drought was probably number three on the list. Drought, farmers, crop, flooding,” Jackowski said. “All I’m saying is it’s really important that we manage risk and exposure. It’s why Duck Creek is investing so heavily in tools to do it.”

Macroeconomic Factors

Macroeconomic factors are also affecting the cost of losses, Jackowski explained. In 2016, it was easy to get a mortgage, but by 2020 rates spiked up to 8 percent, he noted. “This put immense pressure on insurer,” he continued. “It impacted their profitability. Replacement costs went up, repair costs are going up and it’s driving severity to new levels.”

Geopolitical uncertainty, as exemplified by wars in Ukraine and Gaza, are only fostering greater macroeconomi challenges, Jackowski suggested. Regulators have responded to requests for rate approvals, positively impacting profitability, but the combined ratio has also risen above 100.

“Our cat losses are still impacting that number,” Jackowski said. “We did have a two-point improvement on overall loss in LAE ratio. That’s a good sign. That means it’s easing up in this hard market in insurance.”

Using the example of relative speeds of a boat or a car when turning, Jackowski speculated on changes in the market in 2024. “We’re going to see which insurers just took rate blanketly because they needed to, versus who got really surgical,” he said. “’Where do I need to take the rate? Where do I need to see the risk? How do I place it in properly?’”

“In other words,” Jackowski continued, “who oversteered, and who’s steering perfectly on that boat?—because that’s the way insurance works. This is why we’re making investments in tools. Please check out our machine learning module that really has a rate modeling engine. We have a world-class rating engine, and now putting that together with rate modeling is kind of a next step for us going forward.”

Technology Distruption

In terms of the impact of technology disruption, GenAI will have the greatest impact in our lifetimes, Jackowski ventured. “I’m making that statement purely on adoption. For, OpenAI’s ChatGPT reached one hundred million users in two and a half months. One hundred million active users in two and a half months. Do you know how long it took Instagram to reach a hundred million active users?”

Jackowski also discussed the disruptive potential of embedded insurance, noting Duck Creek’s partner The Hartford selling insurance products through senior citizen affinity group AARP.

“You can log in to Tesla, buy insurance immediately on the app—hey know everything already about Mike Jackowski, so they can find that thing on the spot,” he continued. “When you’re renting an Airbnb, putting that cover in, they’re making it part of a single payment, and integrating that. You see Root Insurance doing the same thing with Carvana. There are, are several people that estimate that this is going to be a seventy billion dollar business in the US by 2030.”

Jackowski said it was important for insurers to monitor the evolution of embedded insurance carefully, as it requires partnerships. “You need to forge new relationships and also make sure your tech stack is ready to integrate at the point of sale with others,” he elaborated. “We’re working very hard here at Duck Creek to do that.”

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Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For nearly two decades, he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at or (503) 936-2803.

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