What is an underwriting workbench & why have they become so important to Insurers & Reinsurers?

In this series of blogs, I will explore the use of Underwriting workbenches by Reinsurers and their role in a typical reinsurer. I will also outline the value they deliver from underwriting, service and operational perspectives and how they extend the capability and the lives of stable but old core policy admin systems.

To start with, I will define what I mean by an Underwriting workbench as invested in by (re)insurers in recent years. At its most simple, a workbench is a single interface that sits on top of one or more existing systems. It can be thought of as a “single pane of glass” or a user experience platform (UxP) for underwriters and experts delivering underwriting processes and propositions to clients. No single implementation is the same because of the different classes of business written and the often unique existing system landscapes in which workbenches are integrated.

To illustrate, we have seen workbenches “sat over” core policy admin systems (PAS) and a multitude of other systems such as exposure management, data warehouse, rating and pricing, business rules engines, CRM and pipeline/business planning systems.

Given that the only constant in this landscape is the PAS, one might reasonably ask why “can’t it do what the workbench is doing?”. The answer is primarily down to that most PAS in use today were conceived to be chiefly concerned with “post bind” processes and the feeding of downstream systems. They were not designed to support the “pre-bind” needs of underwriters, but rather the capture of pre-bind underwriting outcomes. Understandably these “core data record centric” systems cannot easily be developed to deliver the types of pre-bind capabilities listed below (certainly without considerable effort and risk):

• Collaboration & process orchestration for the synchronisation and pro-active management of pre-bind underwriting processes execution; ensuring collaboration between the teams to deliver the underwriting outcome.
• Data enable decision making whereby the internal and external data, information and insight required to underwrite a risk is curated.
• Risk selection guidance and pricing decision-support from business rules engines and from vendor or in-house developed pricing and modelling tools.
• Portfolio & Pipeline Management real-time visibility of portfolios performance and associated pipelines.
• Relationship management visibility of ongoing broker and client relationships to further inform decision-making.
• Compliance & governance with the audit trails recorded through the process orchestration and automated peer review.

Other capabilities include rapid change business rules and guidance, document ingestion, and distribution integration with partners, broker, and third-party placement/trading platforms.

The underwriting and service excellence benefits enabled through a workbench are clear:

• Underwriting discipline and consistency, from the embedding of standardised underwriting process and practice, with business rules used to prompt guidance and exception management.
• Data informed decision making; so that risks can be underwritten thoroughly at a discrete level and at an incremental portfolio impact level, minimising the number of times decisions need to be made with less than perfect information, included is envisaged pipeline, tracking against the business plan, expected profitability and return on capital, etc.
• Service excellence from being operationally pro-active by knowing what needs to be done by whom and by when, ensuring all individual hand-shakes within an organisation happen without incident, and any issues are alerted early.

In my next blog, I will explore the operational attributes and benefits of underwriting workbenches, from multi-country co-ordination, automaton and elimination of low-value but time-critical work.