Even though representatives of Lloyd’s of London prepared the world for the news last year, mid-January headlines prompted some stunned reactions.

One of those headlines—”Lloyd’s Weighs Future of Headquarters as Market Embraces Flexible Working“—introduced an article posted on Carrier Management’s website.

“Oh noooooo….!!!!!” wrote one commenter on LinkedIn, giving a two-word response to someone’s post of a similar article in the Financial Times titled, “Lloyd’s of London considers exit from landmark City building.”

“This would be a disaster. People do business with people, not monitors!” wrote another after reading the post of yet another article from Sky News titled, “Why Lloyd’s of London could be saying farewell to the iconic HQ designed to bring people together.”

Lloyd’s is not the first insurance entity to contemplate vacating a building in which veteran underwriters and other professionals worked for much of their careers. Last October, Allstate said it planned to sell its headquarters building. “Allstate’s employees have more choice about where they work, and many are choosing to work from home,” a spokesperson said before the carrier closed a deal to sell in November.

In April 2020, insurer Nationwide began exiting most buildings outside of four main campuses and moving associates in these locations to permanent remote-working status.

For Lloyd’s, a review of “leasing arrangements” was a scheduled activity for 2022 set out as part of a Future of Lloyd’s initiative to redesign the underwriting room. “As our ways of working change, we are on a once-in-a-generation journey to redesign the iconic Underwriting Room and supporting spaces in the Lloyd’s building. The decision to undertake this journey has been driven by the increasing trends of flexible working and digitalization, which have been accelerated by the COVID-19 pandemic,” wrote Chief Executive John Neal in his forward to an April 2021 report on an extensive market consultation that took place in first-quarter 2021 to gather insights and ideas about the future space requirements and marketplace needs.

Work from home—or somewhere other than the company headquarters or signature building—is becoming a reality that workers embrace. (Related article: “Employees Saying Adios to Carriers, Brokers Requiring Work in Office.“) But within the C-suite, chief financial officers and other leaders have differing views about the tradeoff between gaining real estate income and losing cultural interactions and training opportunities. Here are some of the views documented in the Lloyd’s report voiced by market participants on culture and talent issues:

“Culture must be a key feature of the future experience—maintaining the camaraderie, vibrancy, and an inclusive sense of belonging the Underwriting Room environment creates to support commercial and personal interactions.”

“Market participants benefit from serendipitous encounters and ‘osmotic learning’ that physical proximity promotes.”

“The learnings gained through the Underwriting Room cannot be replicated artificially—this is fundamental to attracting, retaining, and developing the next generation.”

Beyond Lloyd’s. CROs Not Sold on Work From Home

It’s not the first time I’ve heard those views expressed recently. During a virtual conference presented by Fitch Ratings late last year, I was surprised to hear what it was that a CFO and two chief risk officers said surprised them most about operating during the pandemic.

“I’m surprised at the shift in attitude about work from home,” said Thomas Weist, executive vice president and CFO for Tokio Marine HCC. “Before the pandemic, we had folks asking if they could have a day to work from home, and the answer was absolutely not. And now, you know, it seems like the whole world has changed…I’ll be honest, that surprised me,” he said.

Weist said he’s particularly surprised by the demographics that favor working from home over going into the office. “Some of the younger folks [who] need to be in the office, that need to have that person-to-person learning, [are the ones] that seem to prefer working from home,” he said.

Co-Panelist Mark James, chief risk officer and senior vice president for CNA Financial Corporation, thought about the CFO’s observations. “He is probably looking at his real estate line item saying, ‘Hmm. This is definitely a number that could be smaller in the future,'” said James, attempting to get deeper inside the Weist’s head.

“Maybe it doesn’t mean that everyone goes to a work-from-home model, but if you’re in the major global cities, you might be thinking about taking your real estate footprint down by 25, 50 percent over a certain period of years as leases renew,” said James, focusing on financial implications of changing attitudes about work arrangements.

“Then maybe [you] stand up some smaller offices outside of the cities to allow people to come in, almost like your own personal WeWork arrangement for employees,” he said.

James and co-panelist Teresa C. Cracas, Esq., chief risk officer and senior vice president, Cincinnati Financial Corporation, expressed some discomfort with work-from-home arrangements over the long term, echoing some of the same concerns expressed by the Lloyd’s market consultation participants in different words.

“It will be interesting to see how career development evolves in the hybrid or work-from-home environment,” said Cracas. “We, as company leaders, are going to have to be very intentional and pull more of our associates into conversations,” she said, referring to the negative impact of a Microsoft Teams environment on those who might be a little more introverted, or who might be new to their careers in insurance. “It’s going to really change our roles as managers and as leaders, as well,” she said.

James said: “We’ve taken to hiring people that don’t sit in Chicago for what I would deem home office roles, and getting very comfortable with that. We’ve taken to hiring people that we’ve never met in person…”

“But I think longer term, there is something lost by not being in an office and together as a team. And I think that’s going to be the more challenging thing to quantify over time,” he said.

“I have been in Chicago five times since the end of June, and it’s awkward to sit in a meeting room, where we’re in a meeting room—three on video and three in the meeting room. It’s a whole new way of learning to work even with state-of-the-art audio and video capabilities,” he said.

So, What’s the Answer?

I have been working from home “asynchronously” (my new word of the year) with my colleagues since I joined Wells Media almost a decade ago. When I started, I missed going into the office even though there’s a perception that journalism can be a head-down, work-on-your-assignment, don’t-bother-me world in some newsrooms. That’s not always the reality, and in the newsrooms where I learned the trade, there was an energy that came from being able to share sources or ideas for story angles.

Oddly, I don’t think I would have had much of a problem with remote work when I worked in the insurance industry. Certain roles—mine was actuarial—probably lend themselves quite well to isolation and focus without the distractions of office gossip and companywide catch-ups.

But underwriting? Yeah, I can see where the office exchange of information can be valuable.

All that said, you couldn’t tempt me with double my salary to leave the confines of my home to work in an office today. Getting on the subway? In New York City? With Omicron spiking and who-knows-what variant waiting to crop up next? No thanks. I’m afraid for my neighbors and friends who have been summoned back to their offices.

And I admire younger colleagues who are reprioritizing child-raising activities, and those in my age group with elder care responsibilities, scheduling work assignments around them. That’s not easy to do whether you work from home or in the office. But it certainly is easier without a commute.

So, how can employers accommodate the new world of work?

First, I’ll offer one solution that I’ve heard that seemed patently ridiculous—sorry Bill Gates—and one that has promise. The right answer probably lies somewhere in between.

Second Screens and Simulators

Gates began a Dec. 7 “year in review” blog item on gatesnotes.com describing the “strange and disorienting experience” of COVID isolation. “My personal world has never felt smaller than it did over the last 12 months,” he wrote, expressing something that most of us have been feeling.

Later in the post, he talked about his interest in “how technology can create more spontaneity with remote work” moving forward.

“This is the biggest thing you lose when you’re not in the office. Let’s say you used to work in an open space with six other people. You could look up at any time and see what they were up to. You could tell whether they felt like talking, giving you advice, or just taking a break to chat about non-work stuff.”

Reflecting on the inability to initiate unplanned conversations from your living room or kitchen table office, Gates suggests that you could do it “if you had a second [computer] screen…You could have a feed of all six of you sitting in your home offices working. You could look at the screen to see what everyone is doing (except when someone wants privacy and turns the camera off). When someone seems like they’re free to talk, you could just click on their video, zoom in and start chatting.”

OK, I don’t know about the rest of my colleagues, but I’m not feeling it.

Gates goes on to talk about digital avatars interacting in 3D instead of in Zoom- and Teams-like 2D grids, and even the possibility of donning VR googles so that you feel like you’re in the same room with your co-workers. “There’s still some work to do, but we’re approaching a threshold where the technology begins to truly replicate the experience of being together in the office.”

The vision Gates shared of the future virtual world environment seemed a little far-fetched to me. But I did recently see a photo of an InsurTech’s office-cam streaming live shots of the physical office to at-home colleagues. And I had a lot of fun late last year viewing the making of a video game—a 3D training simulator for insurance underwriters—created through a collaboration of Hiscox and Attensi. My favorite part allowed the video game player—an underwriter in training—to negotiate with a broker avatar in an effort to increase cyber rates on an account that had some profitability problems.

You can read more about the training solution, created to offer an engaging tool for a new generation of underwriters in COVID times and after, in the article “Gamified Underwriting: How Hiscox Is Transforming Training With an ‘Underwriter Simulator’” in Carrier Management’s January digital magazine.

In our next print magazine, Carrier Management is going to be featuring talent management as a topic. I would love to hear your ideas. How is your company handling the new world of work? Selling the building? Requiring people to come back?

What are some of the advantages and disadvantages of the hybrid working model that you have encountered, and how are you making it work?