Build underwriting systems fit for the future

The fact that data is the oil lubricating the engine of insurance is well understood by carriers. But how well it is managed and integrated into the underwriting process still varies widely.

In a bid to help carriers understand how to make the most of valuable proprietary information, as well as add vital context and colour with third-party data, Eileen Potter, solution marketing manager, insurance, at ABBYY, will be speaking at Underwriting Innovation USA on November 9, 2021.

She will guide attendees through ways to acquire the most valuable third-party information, and embed it into the business in a way that is easily accessible by those who can most benefit from it, and explore the value that insurtech can add to this process.

This session will demonstrate that even the most legacy-bound insurance ecosystems can benefit from the twin opportunities of technology and data if some time is taken to evaluate processes and priorities. Potter spoke to Intelligent Insurer ahead of the event.

Why is third-party data so valuable?

If you’re only looking internally at your own data, you’re not getting the complete picture. There’s an enormous amount of data that can help you get a more accurate picture of risk. Equally, it’s vital to get information that is up to date. It’s not enough to be still pulling a microfiche or downloading a report from Dun & Bradstreet.

Data is so dynamic now that you must use every opportunity to get up-to-date information. Changing intelligence can impact the whole underwriting portfolio, from risk selection to pricing. It’s an advantage that underwriters didn’t have in the past—the opportunity to use all this data to evaluate underwriting requirements as well as the organisation’s overall risk appetite.

The challenge is how you turn that data into actionable information without feeling that you’re drowning. If there’s too much information, you feel you can’t make a good decision.

Why haven’t carriers taken advantage of this rich resource until now?

It comes down to whether they feel they can get the data to their underwriters in a format that can be used, as opposed to simply overloading them. Also, insurance organisations tend to be very process-driven.

When was the last time those processes were evaluated? How many have been forced to move to a hybrid model? These teams had processes that were dependent on their working physically together and now they’re not in the same offices. Solving the process issue is not just about digitising the data, it’s about re-evaluating the whole process flow.

Is data quality still an issue?

I don’t know that insurers have thought through the process of how they cleanse data and make it accessible. They think that having a data warehouse is the answer, but for many this is a place where they can’t get at the data. We may have that treasure chest of gold but it’s worthless if we’re not using it.

What’s the benefit of sending an underwriter down a data research rabbit hole when they don’t have the time to analyse it? Getting data, putting it in a format where everyone who needs it can access it, is vital.

What systems should carriers consider implementing to solve the data challenge?

Insurers need to take a good long look at their processes holistically. These are the underwriting steps we have now, and these are the places where we have useful internal data. There are also places where there is useful external data for us, and this is the set of technologies we have that can bring that all together.

It may mean adopting artificial intelligence or internal data processing systems, but you can’t just throw in technology without understanding the necessary process.

Is this the ideal time to consider reappraising your data strategy?

It’s the perfect time because insurers are actively changing the way they work. Do we have people back in offices or are they working remotely, for example? Now they have more empathy with their brokers, who have always had to deal with this kind of disjointed working experience.

Equally, more systems are now made to be easily integrated. I don’t know if anyone could sell technology today if they didn’t have a path to simple integration into an existing ecosystem.

Technology mandates do still tend to be under the purview of the chief executive officer but if you want to improve customer experience and retention, as well as achieving better underwriting results, those mandates must move down to the people who report to the CEO.

Whatever you choose, you can be more certain that you won’t fail if you take a step back and analyse processes and technology as part of a holistic whole.

Eileen Potter, solution marketing manager, insurance, at ABBYY, will be speaking at Underwriting Innovation USA on November 9, 2021, at 10:40am EST. She will take attendees through the underwriting world of the future and delve into the potential of third-party data that’s just waiting to be mined.

This is the biggest online event tailored specifically to underwriting—don’t miss out. Register now!