Insight

Insuring the Future

Thomas Heitzer discusses how new technology advancements are impacting the insurance realm.

An Interview With Noerr
Best Lawyers

Best Lawyers

February 17, 2020 08:00 AM

This interview was conducted as part of the 2020 Edition of The Best Lawyers in Germany “Law Firm of the Year” award recognitions. Our partner Handelsblatt, also published these awards on June 27, 2019, online and in print in their June 2019 edition.

With new technologies come new risks—so, so many new risks to guard against. With all that risk, naturally, comes new insurance opportunities. Munich-based Noerr LLP was recently named the 2020 “Law Firm of the Year” in Germany for Insurance Law by its industry peers, and partner Thomas Heitzer—a 48-year-old who specializes in all manner of insurance and reinsurance litigation—sat down with Best Lawyers CEO Phillip Greer to talk about self-driving cars, the future of fraud, and the prospect of Alexa as your new insurance broker.

Your award indicates that your peers are saying you guys are on top of your game.

Thomas Heitzer: That’s very good to hear. In the end, it reflects strategic development to focus not only on work for the insurance industry but on being a full-service law firm. [We] offer not only transactional or litigation advice but also advice in IE, IT law, cyber, digitalization, employment law, antitrust law.

There’s often a lot of pressure on investment and financial firms to generate outsize returns, so they leverage themselves to the hilt. What steps do you take to protect those investments from downside risk?

Let me start with Germany. Under EU law, insurers are strictly bound when it comes to investment decisions. So, you don’t see insurers with hyper-leveraged positions. After the subprime crisis and the Lehman [Brothers] crisis, you’ve seen a narrowing of interest rates, which is critical for the insurance industry. This is one of the major threats at the moment. In the life insurance business, we’ve been advising two main groups in “death investing”—selling their licensures to specialized runoff entities funded by private-equity money. For example, ARAG, a German-leading legal protection insurer in Europe, sold entirely their shares in life insurance entities. Life insurers are bound by strict rules like how they are allowed to invest their capital. The disadvantage is that they have no opportunity to go into promising but riskier investments, which makes it hard for them to generate the contractually guaranteed returns.

Self-driving cars still appear to be a few years away. How does the insurance industry view these vehicles?

The obvious change is on the liability side: If I have a self-driving car, is the driver or the owner of the car liable in an accident or the manufacturer? Or the IT expert who created the program? In Germany, you have mandatory third party-liability insurance already in place. Then you have insurance coverage usually taken out for new cars, for damages, and then you have product liability for the manufacturer.

So, if you look at the full scope of insurance coverage already in place in Germany, one could say, “OK, there might be a shift. There might be a stronger liability for accidents due to a failure in the IT system.” And then one could argue, “OK, then that might necessitate an increase of the insurance sum, which is necessary when the manufacturer is liable.”

Supposedly self-driving cars are safer than a human driving. When it comes to the premium, one could say, “OK, fewer claims, damages, accidents. On the pro, this would lead to a reduction of premiums. However, on the negative side—and this is what [CEO Oliver Bäte] from Allianz has said: “Look, those cars are stuffed with IT, which is very costly in the event of an accident.” So, in the end, this is what our clients assume and expect: There will be no major change in insurance premiums only from self-driving cars.

With regard to cybersecurity and data privacy, how is insurance keeping up?

The EU has implemented strict regulatory regimes under which insurers are obliged to observe high cybersecurity standards. This is a sensitive issue, as you know from Facebook, Google, and all those companies, which face penalties in Europe.

On the second side—and this is more of a business opportunity for the insurance industry—around two or three years ago everyone talked about cybersecurity, cyber-insurance, cyber-protection. But had you asked any of the major insurance entities, “Have you taken out insurance coverage for cybersecurity?” they’d [say no]. Nowadays, after some attacks, this picture has totally changed.

Critical infrastructure is not only the financial industry, such as insurance and banks. Think of the energy supply: You have nuclear power plants. You have pipelines. You have hospitals. This is where the insurance industry jumps in to provide solutions.

Imagine a global banking institution is injected by some spam. This will have consequences for the customers, for the clients of the banks. This is a high risk when only one failure, one attack, goes through—such a massive risk for the insurance industry that it is quite difficult to assess. Some insurers are quite reluctant to take such major risks.

Insurance fraud is still a problem, but how people and companies conduct it is changing. What steps do you take to prepare your clients?

We have experience where we can say, “this is very strange from a logical or a life-experience perspective,” and we have corporations with special firms that provide investigation services. How can we prevent [fraud], and what are insurers doing, though? I see a lot of new technology in this area: With artificial intelligence, you can run huge amounts of data from the current claim to data from comparable claims. Such systems can identify whether this claim shows the correct signs for a claim of its kind. This is how insurers expect to deal with insurance fraud in the future. They’re armoring themselves up.

Do you see any of the major emerging technologies—blockchain, the internet of things, smart contracts, chat bots—as beneficial to the insurance industry?

Let’s take the perspective of the consumer. The new generation is growing up with iPad, iPhone—they do not want to see an insurance broker in their living room. The consumer expectation is “I want it quick, not much time, not much effort. I want to buy everything online.” However, insurance is a [legally complex] product. Under German and European law, insurers and brokers have to provide the client with tailor-made protection. This means you need some kind of interaction. We’re advising digital insurers already on chat bots—with Amazon’s Alexa, for example, there’s no human being intermediating the policy to the customers. It goes automatically. But it’s a very narrow line to meet regulatory requirements and issues like data and consumer protection. In the end, this might be a big challenge for the old insurers compared to the startups that can quickly set up an IT structure.

As you look ahead, are there any upcoming projects you’re especially excited about?

I’m looking forward to the rapid changes. This is a mega-trend for the insurance industry: Every day is challenging; every day you have to reinvent yourself. This is also what I look forward to for Noerr—making ourselves better every day in very demanding times.

This interview has been edited for length and clarity.

Related Articles

"Lawyer of the Year"


Black and white headshot photo of woman lawyer

Jennifer Arnett

Insurance Law

Boulder, CO

2024

3 Key Considerations for Navigating Complex Insurance Litigation in Florida


by Best Lawyers

Insurance litigation in Florida can be very complex. Issues related to insurance regulations have created an especially litigious environment. Learn more here.

Living room in a house flooded with water

The 2024 Best Lawyers in Germany Launch


by Best Lawyers

The results honor the top lawyers and firms in Germany, including the 15th edition of The Best Lawyers in Germany™ and the 3rd edition of Best Lawyers: Ones to Watch in Germany™ recipients.

Germany town beside a river and bridge with clear blue sky above

Announcing The Best Lawyers in Germany™ 2023


by Best Lawyers

The results include an elite field of top lawyers and firms from Germany.

Black, red and yellow stripes

Best Lawyers: A Technology Powerhouse in the Legal Industry


by John Ettorre

Best Lawyers, a legal publishing company, is paving the way in the industry as a tech-first giant.

Best Lawyers is a Tech-First Titan

Germany Is In the Driver’s Seat—Should We Follow?


by Greg Sirico

As Germany aims to become the first nation to legalize autonomous driving technology, it remains to be seen if the benefits outweigh the legal implications.

Germany Aims To Legalize Autonomous Driving

Announcing the 2022 Best Lawyers™ in Germany


by Best Lawyers

The results include an elite field of top lawyers and firms, including our inaugural Best Lawyers: Ones to Watch recipients.

Announcing the 2022 Best Lawyers™ in Germany

WATCH: Best Lawyers Discusses COVID-19 & Business Interruption Claims


by Best Lawyers

Three legal experts join CEO of Best Lawyers to talk about business-interruption insurance claims resulting from COVID-19 closures.

COVID-19 Panel: Business Insurance Claims

Insuring Success


by Janice Zhou

Atlanta’s 2020 Litigation/Insurance “Lawyer of the Year,” Lisa Bondurant, on leadership, learning, and how to forge a true understanding of your clients.

Lisa Bondurant

The Company They Keep


by Best Lawyers

Thomas Richter discusses the idea of corporate criminal liability.

An Interview With HammPartner

Easy Being Green


by Best Lawyers

Markus Deutsch discusses the impact of climate change on the firm and its clients.

An Interview With Dolde Mayen & Partner

Impact of Climate Change on Real Estate Law


by Best Lawyers

Dr. Christian Schede discusses rent in large cities, the effect of Airbnb, and more.

An Interview With Greenberg Traurig

Property Protectors


by Best Lawyers

Georg Schönherr and Thomas Adocker discuss the theft of trade secrets, patent infringement, and strategies to combat fake goods.

An Interview With Schwarz Schönherr Rechtsanw

A Studied Neutrality


by Best Lawyers

Marcel Meinhardt discusses a new interpretation in competition law, new challenges as technology advances more and more, and other topics.

An Interview With Lenz & Staehelin

From Russia, With Law


by Best Lawyers

The bite of U.S. sanctions aside, Cleary Gottlieb partner Yulia Solomakhina sees great promise for commerce and the law as Russia increasingly embraces markets and technology.

An Interview With Cleary Gottlieb

How Technological Advances Can Help Corporate Law


by Best Lawyers

Dieter Gericke and Benjamin Leisinger discuss how being aware of technological advances helps them provide corporate financial advice.

An Interview With Homburger

Trending Articles

Presenting The Best Lawyers in Australia™ 2025


by Best Lawyers

Best Lawyers is proud to present The Best Lawyers in Australia for 2025, marking the 17th consecutive year of Best Lawyers awards in Australia.

Australia flag over outline of country

Best Lawyers Expands 2024 Brazilian Awards


by Best Lawyers

Best Lawyers is honored to announce the 14th edition of The Best Lawyers in Brazil™ and the first edition of Best Lawyers: Ones to Watch in Brazil™.

Image of Brazil city and water from sky

The Best Lawyers in Mexico Celebrates a Milestone Year


by Best Lawyers

Best Lawyers is excited to announce the 15th edition of The Best Lawyers in Mexico™ and the second edition of Best Lawyers: Ones to Watch in Mexico™ for 2024.

Sky view of Mexico city scape

How To Find A Pro Bono Lawyer


by Best Lawyers

Best Lawyers dives into the vital role pro bono lawyers play in ensuring access to justice for all and the transformative impact they have on communities.

Hands joined around a table with phone, paper, pen and glasses

How Palworld Is Testing the Limits of Nintendo’s Legal Power


by Gregory Sirico

Many are calling the new game Palworld “Pokémon GO with guns,” noting the games striking similarities. Experts speculate how Nintendo could take legal action.

Animated figures with guns stand on top of creatures

Announcing The Best Lawyers in New Zealand™ 2025 Awards


by Best Lawyers

Best Lawyers is announcing the 16th edition of The Best Lawyers in New Zealand for 2025, including individual Best Lawyers and "Lawyer of the Year" awards.

New Zealand flag over image of country outline

Presenting the 2024 Best Lawyers Family Law Legal Guide


by Best Lawyers

The 2024 Best Lawyers Family Law Legal Guide is now live and includes recognitions for all Best Lawyers family law awards. Read below and explore the legal guide.

Man entering home and hugging two children in doorway

Announcing The Best Lawyers in Japan™ 2025


by Best Lawyers

For a milestone 15th edition, Best Lawyers is proud to announce The Best Lawyers in Japan.

Japan flag over outline of country

The Best Lawyers in Singapore™ 2025 Edition


by Best Lawyers

For 2025, Best Lawyers presents the most esteemed awards for lawyers and law firms in Singapore.

Singapore flag over outline of country

Canada Makes First Foray Into AI Regulation


by Sara Collin

As Artificial Intelligence continues to rise in use and popularity, many countries are working to ensure proper regulation. Canada has just made its first foray into AI regulation.

People standing in front of large, green pixelated image of buildings

Commingling Assets


by Tamires M. Oliveira

Commingling alone does not automatically turn an otherwise immune asset into an asset subject to marital distribution as explained by one family law lawyer.

Toy house and figure of married couple standing on stacks of coins

How Much Is a Lawyer Consultation Fee?


by Best Lawyers

Best Lawyers breaks down the key differences between consultation and retainer fees when hiring an attorney, a crucial first step in the legal process.

Client consulting with lawyer wearing a suit

Presenting the 2024 Best Lawyers Employment and Workers’ Compensation Legal Guide


by Best Lawyers

The 2024 Best Lawyers Employment and Workers' Compensation Legal Guide provides exclusive access to all Best Lawyers awards in related practice areas. Read below and explore the legal guide.

Illustration of several men and women in shades of orange and teal

The Hague Convention and International Custody Battles


by Alexandra Goldstein

One family law lawyer explains how Joe Jonas and Sophie Turner’s celebrity divorce brings The Hague Convention treaty and international child custody battles into the spotlight.

Man and woman celebrities wearing black and standing for photo

Filing For Divorce in North Carolina


by Melody J. King

Family law lawyer Melody King answers some of the most important questions individuals may have about filing for divorce in North Carolina.

Illustration of man and woman on paper that has been torn apart

Things to Do Before a Car Accident Happens to You


by Ellie Shaffer

In a car accident, certain things are beyond the point of no return, while some are well within an individual's control. Here's how to stay legally prepared.

Car dashcam recording street ahead