The new year and post-holiday season are upon us. Now that the excitement has died down and family and friends have been seen off, it’s natural to spend some time reflecting on 2022 and thinking about 2023. If you did, you might have returned to what seems like an annual New Year’s resolution for your company: to use more data and technology in underwriting.
This is a harder problem than meets the eye. Over the past few years, many of the insurtechs claimed to have the answer, bursting onto the scene by raising vast amounts of capital and “disrupting” underwriting. While the industry put a few eggs into this basket, these providers have generally fallen short on their plans for transformation, so that bubble will continue to unwind.
On the other side of the coin, many insurance companies have tried to develop in-house capabilities, sometimes cobbling together some novel artificial intelligence technology to save the day. These also have tended to fizzle, as they often create more work for already overtaxed underwriting teams.
To accomplish the dual goal of augmenting underwriting with timely and relevant data while keeping employees happy and productive, a different approach is required. In our work to help our clients achieve these ends, we’ve identified a few key patterns that have facilitated success.
- A top-down strategic commitment to your talent. Savvy executives recognize they have deeply talented professionals in underwriting. Technology and data need to make the work of the underwriting team easier, not more difficult.
- Supplying the right data, to the right people, at the right time. The amount of data collected in the underwriting process is tremendous and one of the values technology can provide is making sense of that data. But it needs to go one step further than organizing. To truly increase productivity, data must be curated for the user and accessible when and where it’s needed.
- An iterative approach unlocks immediate and ongoing gains. So many executives have been burned by technology projects that take years to deliver and yet fail to improve the day-to-day experiences of the people doing the work. By delivering value to these users in the short term, you win the right to go even further. That usually means starting small and proving value up front, allowing the kinks to be worked out and momentum to build, as opposed to a big-bang enterprise approach.
- Success lies in partnership. Moving from manual workflows to ones supported by technology is a long road that can be difficult to travel entirely on your own. Discovering technology providers that operate in a true partnership capacity will help you maximize their potential. You bring expertise in your business and industry, and your tech partner can help build scalable systems, inject a scientific, data-driven approach into decision-making and create success in your organization that drives excitement, not frustration, with technology.
As you start to realize your vision for 2023, we hope that you’ll keep these principles in mind. Transforming data and technology in underwriting is no easy task, but once accomplished, the benefits are endless – happier employees, easier recruiting and more profitable growth are just a few. At Two Sigma Insurance Quantified, we are excited for 2023 and beyond, and humbled by the trust our clients have placed in us to deliver for them. We look forward to helping you finally cross that New Year’s resolution off the list.