Operational attributes and competitive benefits of underwriting workbenches for reinsurers
In this blog, I will delve into the operational attributes and benefits of underwriting workbenches for reinsurers, particularly those aspiring to meaningfully differentiate their service from their competitors, including those reinsurers with multi-country business units. This blog is the second one of a four-part series; you can read the first blog Underwriting workbench & Its importance for Insurers & Reinsurers.
Most reinsurers present themselves as the best partner with an unstinting client focus. Reinsurers are no different from any other service business; deep and extensive engagement with clients and brokers makes for a better outcome for all parties. Yes, when compared with insurers, the number of underwriting transactions conducted with brokers and clients is considerably less and typically of much higher value; but these perspectives do not diminish the need for reinsurers to properly operationalise their partnering focus, so as to deliver an accelerated and “easy to do business with” service, as well as the right proposition and pricing for the client.
There will always be some elapsed time, particularly when handling large treaty data sets with data quality issues, but beyond that, in most reinsurers there will be many moments of data being rekeyed from one system or to another that needlessly extends the elapsed time. It is not simply the rekeying act; it is the checking, version management and co-ordination overhead required to support such a model. The overhead is repeated with every option explored. Distended turnaround times reduce the time available to engage with clients and brokers to find “right for all parties” agreements. Reinsurers with the fastest turnaround times create an advantage over their peers.
Eliminating rekeying through a workbench makes particular sense as each hand-over of data is in the context of a process that needs to be pro-actively co-ordinated to deliver a target service. A contextual handshake using collaboration tools that “colours” the data delivered from one expert to another, for example, from UA to Cat Modeller, from Modeller to Pricing, from Underwriter to Account manager. A workbench should provide the collaboration tools, process orchestration, and process history to enable the colour and context to be seamlessly passed with every automated data handshake.
For organisations that have cross geography operations, as a consequence of mergers or acquisition, or deliberate territory expansion or off-shoring, it is common for reinsurers to deploy a common global policy admin system to create a common risk repository; it is less common though for a workbench to be globally deployed. This is surprising as the turnaround challenge for reinsurers with teams and management across geographies, time zones, and languages gets steeper, especially when handling clients with similar cross geography stakeholders and multi-national requirements. Peer review is an excellent example of a process that typically needs to be conducted by stakeholders across borders and time zones.
A common risk repository is good but combined with a common underwriting workbench is optimal, particularly one that can be customised to local products, processes, taxes, and languages. What better way to industrially operationalise a reinsurers underwriting DNA across borders and time zones.