Designing an underwriter-first future

An era of extensive digital disruption is undoubtedly exciting. There are new ideas around every corner, potential solutions for a wide variety of challenges that promise to improve efficiency and cut cost. But often these revolutions come at a cost for the people attempting to implement them.

Intelligent Insurer spoke to William Ross, chief executive officer of Federato, who will discuss how to relieve the burden from underwriters at May’s Commercial Lines Innovation USA Virtual Event. He will also show how simple changes can give your organisation real-time insight into risk selection.

The Federato team will reveal insights from over 1,250 hours of interviews that demonstrate exactly how you can look to your own organisation’s creativity to drive change.

What does an underwriter-first future look like?
Above everything else, the goal is to help organisations see that, in light of all the things we are doing to enhance straight-through-processing (STP) and push cost out of our business, good underwriting still requires they give the best possible experience to people in their organisation.

This is going to be especially important as skills disappear, with a huge tranche of the underwriting community approaching retirement. Many insurers are simply not investing the time they need to in order to hear the concerns from those on the front lines.

Why do you urge listening?
It’s simple: we recognised that the insurance companies we worked with weren’t doing so.

We have consistently observed over the last few years that insurance companies have become so focused on expense management that they don’t appreciate that for every STP innovation, there is a change to the underwriting organisation.

Creating a cohesive experience in the underwriters’ workflow that seamlessly works with your STP strategy is essential.

Why are underwriters suffering from ‘the fatigue of constant change’?
The push to STP is certainly among the causes but we’re also finding that a lot of small transformation projects, created in the spirit of being agile, are creating more and more disparate systems. Underwriters’ reality is 15 tabs open across three monitors, some belonging to in-house systems, some external.

These poor underwriters need to find a way to bring all that information together in a single, cohesive analysis. In attempts to be agile and scrappy, insurers have lost the importance of bringing that information together for the underwriter.

How can real-time feedback on quote-bind-issue help underwriters?
What we see, especially in a hard market, is that a lot of organisations are trying to triage submissions and renewals based on appetite. But there’s an opportunity here to factor in signals such as winnability and underlying price elasticity. This allows underwriters to prioritise their time, not just around what the organisation thinks is important business right now, but also around what they can actually go out and win.

A lot of time is sunk into risks that underwriters have an appetite for but just can’t win.

What does ‘integrated risk ops’ look like?
There is a very high degree of statistical sophistication to the work that goes into static risk analysis. This happens at the time of guideline creation, or rating, or reinsurance. But many insurers have still failed to bring that risk information into the core of their underwriting operation.

We believe it possible to provide the underwriter a delightful user experience while allowing all of that risk complexity to be incorporated underneath the hood.

What should attendees take away from your session?
More than anything, we want to communicate that insurers owe it to themselves to have some introspection. To ask the question: why is it that we’ve been talking about ‘precision underwriting’ for 15 years and still haven’t made progress? This isn’t about ‘buy X or Y product’, it’s about listening to your people and embracing their needs.

Different generations grow up with entirely different technology stacks and younger people often create elegant solutions on their laptops that, were they embraced at scale, could help junior and experienced underwriters alike. If all we did was encourage chief underwriters and chief information officers to listen to the people they work so hard to hire and retain, we’d be happy.

William Ross will be speaking at Intelligent Insurer’s  Commercial Lines Innovation USA Virtual Event (May 18 to 20). The event is free to attend for insurers and brokers/agents, but you must register in advance. Sign up to access the content live and on demand here.