Who is the Underwriter of the Future?

Let’s face it. Commercial lines underwriting is undergoing a transformation. And, underwriters need better tools to make more informed decisions that drive profitable growth and reduce losses.  I recently came across a panel topic for an upcoming conference called “Enabling the Underwriter of the Future”.  A candid description of the session called out the fact that commercial lines is essentially at a crossroads, and it’s time to move forward with data, technology and tools that will attract the next generation of underwriting talent to the industry.

At the same time, Insurance Networking News just published a great article in their latest issue called “The New Data-Driven Insurer”. In it, they detail a report from analyst firm SMA showing where P&C insurers are increasing their technology investments to improve overall performance. The top area for technology investment in 2013 is data and analytics initiatives that support underwriting, with 55% of insurers increasing spending. Other investments are going to support marketing (46%) and claims (37%).

XL Group’s IT leader, Kurt Schulenburg, framed up the underwriting challenge this way: “If we wanted to go back and look at all the risks that have shared characteristics, we’d have to assemble a bunch of Excel spreadsheets and emails…When you work in a manual environment, all you’re able to use is the experience of the underwriter. What we are trying to get to is a combination model, where we use the experience of the underwriter, but we augment that with better analytics and more data from prior years.”

We couldn’t agree more. Underwriters bring valuable expertise that needs to be supported by allowing them to leverage data from claims, underwriting, agents and pricing. And, it needs to be seamless and real time within the underwriting workflow. The underwriter of the future will be able to unlock the power of data and analytics to aggressively price the best risks, avoid the poor ones and run at a profit that’s sustainable and supports growth.

If your organization is on a journey to become more analytically driven, use Valen’s Analytical Readiness checklist to ask the tough questions and facilitate dialogue internally with your team.

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