Meet the Pros: Jeffrey Duke – Auditor

Could you please tell us a bit about your background and your current role, including your main responsibilities and key areas of interest/expertise?

Currently, I am the lead auditor for US reinsurance claim audit engagements. Before joining Pro Global I led reinsurance claim audits for an international reinsurer. In addition, I managed claim teams for 27 years, during which time I audited claims handled by my teams. A large part of my career in claims management has been devoted to helping claim organisations achieve regulatory compliance and sustainable profitability, and this interest continues in our audit engagements. In addition, I am highly interested in the way international reinsurance is transforming to answer the changing needs of ceding insurers. I have long been interested in how technology affects society and business, knowing that new technologies can be used effectively to improve customer experience and financial outcomes.

What are the greatest changes you have seen throughout your career, and what key trends are shaping your area of expertise right now?

One of the greatest changes I have seen during my career is how technology has changed insurer and reinsurer work processes and claim departments. For instance, when I started my career, I dictated letters and reports. The world is becoming more integrated; the expansion of Lloyd’s market influence around the globe is paving the way for easier communications among market participants, so that conducting international reinsurance business is in many ways easier than before.

Advances in technology have also caused new risks to appear, some of which have not yet been fully appreciated and managed, perhaps contributing to new casualty catastrophes in the future. For instance, electromagnetic radiation from several sources is increasing; this is likely to cause some negative effects to living things. Another foreseeable problem arises from our desire to have fresh fruits and vegetables year-round; this has meant suppliers experiment with different processes to supply fresh foods in more regions, and we do not yet know the long-term effects of those new processes.

Could you please talk about the impact regulations have on your work? What regulatory changes in the past (or to come), for example, are of particular importance?

The regulatory landscape is changing rapidly, most notably in governance, risk and compliance management. Many insurers use TPAs to deliver their claim services, exposing insurers to compliance and reputational risks. Solvency requirements of the European Commission, such as Solvency II and capital requirements of the National Association of Insurance Commissioners, are affecting reinsurer claim departments, driving an increasing focus on reserve adequacy, portfolio quality and management effectiveness. As vulnerabilities across enterprise and third-party digital ecosystems grow, cyber security has become a key regulatory focus.

There is much focus on enhancing efficiency when it comes to audits. How does technology come into this and what do you feel are the greatest advancements the sector has witnessed?

When I started in the reinsurance business, many ceding insurers were still using paper claim files. Most insurers have digitized their claims systems, allowing for more accurate data, more timely management reports and more reliable financial analysis. Technology has not only greatly sped up communications but it has made data transfer much easier and more efficient, with higher data quality as a result. The time required to prepare for and report on audit engagements has also vastly decreased, while artificial intelligence helps greatly in analyzing and aggregating data. All of these developments have made our lives as auditors easier, more efficient and more productive.

Looking ahead at the coming year and beyond, in your professional opinion, what are the main opportunities and/or challenges emerging throughout the field of Audit & Assurance?

I see many new opportunities arising in our field of Audit and Assurance. New regulations, new technology and new insurance products are providing us with opportunities to help our clients become more profitable, compliant and resilient. As new governance regulations are developed, it will become ever more essential to assure that compliance is achieved consistently and profitably.

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