Three Key Elements Every Underwriting Platform Must Have
Underwriting market dynamics are forcing changes on the traditional Risk/Portfolio Underwriters role in the P&C commercial market that exposes both the Carrier and the Underwriter to more risk and less reward.
For Commercial carriers to remain competitive amid profound changes across the Underwriting landscape they must empower their Underwriters with technology to exploit information accessibility, durability to market turns through no-code configuration, and navigate an information overload. Whilst the quick and precise evaluation of complex pricing structures and removal of mundane processing tasks may be delivered by any recent insurance technology, a true underwriting workbench enables information integration that refocuses the underwriter’s role on only areas that warrant specialized tacit knowledge, build the book, or develop the relationship.
In a report issued in November 2021, McKinsey found that 45% of an Underwriter’s time has traditionally been as an administrator. Almost half of an Underwriter’s valuable time is spent on low-value tasks, time which could be spent on meeting with customers or focused on core underwriting processes. In today’s economic climate, Carriers simply cannot afford key personnel allocated to non-value-added tasks. Unburdening Underwriter´s from performing these types of duties will allow them to focus on high-value tasks such as management of increasing catastrophic (Secondary perils) and emerging risk (Cyber, Covid-19, CBI), optimized risk selection, and an integrated view of relationship management with agents/brokers/insureds effortlessly aligned to risk and portfolio administration.
Almost every insurance technology provider offers an Underwriting workbench or platform that claims to not only automate those low-values tasks, but elevate decision-support at the point-of-underwriting through multiple integration channels- relationship management, distribution, third party data, agency/broker systems – but what are the key components that distinguish those platforms that will make a difference?
There are three elements an advanced Underwriter needs a proper workbench to provide:
- Adaptable insights to market conditions – nimbleness in the allocation of underwriting capital-allocation to new markets aligned to maximizing premium income while managing complex risk exposure. Immediate exploitation of either broader hard market class opportunities or specific ability to “take-a-view” per-risk where the provider time-restricts the opportunity to triage and take up a submission.
- See more “good” risks in half the time – insights shall continue to provide key competitive differentiation and profitability. An information advantage must be gained through the immediate distillation of both digitized and analog engagements, full internal and third-party external data source integration – in real-time, that serves to both qualify/reject individual risks to their risk profile. Success can be defined through the ability to match risk appetite, capacity to incoming risks.
- Decision support “at-the-fingertips” driven through real-time insights that harness a collective view across premium, exposure, loss – tacit, and external knowledge factors.
The Policy Administration System has its place. Although, Underwriters have suffered data entry, double-keying and burdensome policy administration through generic non-specialty focused platforms that don’t align to the business rating processes and organizational fabric of their carrier. Technology is an enabler, to remain competitive the future Underwriter must be empowered through advanced integrated insurance technology that is easily configured to any nuance of an underwriter’s process. The Underwriting Workbench melds integrated internal and external information sources, slick (no-code) user interfaces aligning to specialty class types, and delivery of otherwise unobtainable insights that inform data-driven decision-making at Point-of-Underwriting.
An Underwriter’s role is not an administrator. Re-allocation of the Underwriters specialist tacit knowledge to relationship development, risk framing, distribution, and pricing is only delivered through a dedicated underwriting workbench.