Transforming Commercial Insurance Underwriting with AI

Transforming Commercial Insurance Underwriting with AI

Groundspeed was acquired by Insurance Quantified in 2023.

In this two-part series, we delve into some of Groundspeed’s AI capabilities and how they drive business impact for commercial insurance carriers.

Part One: The Tools

The underwriting process for commercial insurance carriers has traditionally been time-consuming and labor-intensive, often relying on large teams to review and analyze data from various sources manually. According to the Institute’s survey, the average underwriter spends 40% of their time on administrative tasks, 30% on negotiation and sales support, and 30% on actual underwriting. That is a significant amount of time not quoting profitable new business for your company.  

At Groundspeed, we can eliminate the manual underwriting work with our AI technology. In typically under two hours, your underwriters will have structured, near-perfect, and complete risk data to write profitable new business quickly. In this blog post, we’ll outline the six critical steps in Groundspeed’s AI process that transform the underwriting process for market-leading commercial carriers.

Step 1: Document Ingestion

The largest insurance companies connect and push documents, such as insurance applications, broker emails, loss runs, and exposure schedules to Groundspeed by connecting via API, SFTP, or email.

Our pipeline can ingest unstructured formats, such as:

  • jpg, .bmp, .gif, .png, .pdf, .tif, .tiff, .doc, .docx, .xlsx, .xls, .csv, .xlsb, .xlsm, .xps, .oxps, .eml, .msg, .zip

Step 2: AI Data Labeling

Once documents are ingested, the AI-driven pipeline uses advanced technology to identify, classify, and label the extracted data. Our process can extract and classify relevant information from these documents through Optical Character Recognition (OCR) and Intelligent Document Processing technology. The technologies enable the system to accurately recognize and categorize various types of information, including policyholder details, policy limits, claim history, and more. The AI’s data labeling capabilities not only improve the speed of the underwriting process but also enhance the accuracy of risk assessments.

Step 3: Automated QA

The technology performs automated quality assurance (QA) checks on the extracted and labeled data, ensuring that it meets predefined data point accuracy and completeness standards. During QA checks, both extracted and predicted and calculated fields are validated. By identifying and flagging potential errors or inconsistencies, the system reduces the risk of underwriting decisions based on inaccurate or incomplete information, thereby improving the overall quality of the underwriting process.

During this step, we check captured data by:

  • Running statistically significant audits on critical captured data points daily
  • Evaluating metrics for systemic quality issues daily
  • Documenting and reporting resolutions for issues found
  • Aggregating metrics for customers monthly

Step 4: Human Review

Although the AI technology is highly accurate, Groundspeed understands the importance of near-perfect data for underwriting. As a result, we seamlessly integrate a human review step to review the data flagged as lower-confidence data by the AI. An experienced Groundspeed team member will then confirm the accuracy of the data. This combination of AI technology and human expertise ensures our 98% data point accuracy score across all documents sent to our AI technology.

Having a human review process also gives us unmatched flexibility—we can handle (nearly) anything thrown at us. Submission documents come in many shapes and sizes. Systems that only rely on AI are limited to standardized documents they can confidently automate. 

Step 5: Enrichments

Groundspeed’s AI goes beyond merely automating data extraction and labeling by providing additional data enrichments. We use our proprietary predictive models as well as third-party data to enrich the data set. By leveraging external data sources and advanced analytics, the process helps underwriters better understand each risk and make more informed decisions.

Step 6: Fast Delivery

Once the data has gone through the previous steps, Groundspeed AI rapidly delivers the structured data to the underwriting team in typically under two hours via API, SFTP, or email. Once you receive the data set, you can immediately use it to understand the complete risk picture and win profitable new business. This streamlined process significantly reduces the time spent on manual data entry and review, enabling underwriters to focus on high-value tasks such as writing profitable new business. 

Accelerate Your Commercial Underwriting

Groundspeed’s AI technology is transforming the underwriting process for commercial insurance carriers by automating critical steps of underwriting, improving accuracy, and enhancing decision-making. By leveraging advanced technologies and machine learning, the process enables insurers to streamline their workflows, reduce manual effort, and ultimately make better-informed underwriting decisions. As the industry continues to evolve, Groundspeed’s AI will play a critical role in shaping the future landscape of commercial insurance underwriting.

If you want to see how Groundspeed’s AI could help your underwriters increase efficiency and quote business faster, schedule a call today with a Groundspeed team member. 

Part Two: The Business Impact

If you have been on social media recently, you are probably aware of the ChatGPT AI platform released last fall that everyone is currently discussing. If not, here is a brief description to get you up to speed: 

Using AI, Users can ask a “bot” questions about almost anything with this tool. For example, ChatGPT can explain quantum physics or write a poem on command.

While this somewhat new product just went viral with its latest release, AI has been transforming processes for years in different sectors. At Groundspeed, our AI has been a game-changer in the insurance world since 2016, helping commercial insurance carriers increase their quote-to-bind ratio, decrease loss ratio, and lower operating expenses, all while fostering new product growth.

This blog will explore the ways Groundspeed’s AI has helped over 30 middle to large-marketing commercial insurance carriers. 

1. Increase Quote-to-bind ratio

Typically the fastest carrier to quote a business wins the business. That is why you must have the quickest quote response times and better submission prioritization. But we know that for complex business submissions, it sometimes takes underwriters days to manually sort through all the submission documents and note critical data fields needed to underwrite. This process is manual, time-consuming, and costly. 

To accelerate this process, Groundspeed’s AI will give you a near-perfect and structured risk picture in typically under two hours, saving your underwriters days of data entry work. Which in return will allow them to quote profitable new business faster.

2. Decrease Operating Expenses

Over half of every premium dollar collected is spent on expenses associated with writing business, both renewals and new. In addition, the cost to acquire data from each submission ranges from $85 to $100, which is a cost that only represents access to some of the necessary data points. And then, is it accurate? 

Oftentimes, carriers are forced to make the tradeoff of using minimal information to clear a submission and quote new business based on relationship and instinct.

With Groundspeed’s AI, you can automate your data ingestion process, improve the accuracy of data, and increase efficiency for your underwriting team. With this technology in place, now your underwriting team will spend the time they would typically spend on data entry, reviewing structured submission data, and quoting the target accounts that match your risk appetite. 

3. Decrease Loss Ratio

The loss ratio is a critical metric for insurance companies. Groundspeed Analytics uses AI-powered predictive models to analyze historical claims data and identify patterns that indicate potential losses. 

Not only is the structured data delivered to carriers fast, but it is accurate. Our AI maintains a 98% data point accuracy score with our quality assurance process. To ensure accurate data, the AI flags lower confidence values and loops in a Groundspeed team member to confirm accuracy. Then, after human review, enriched data from our machine-learning models and third-party sources are fused into the data set. This way, you can trust that your data will return to you in better and near-perfect form. 

By analyzing historical claims data and providing near-perfect data, underwriters can make more informed decisions, reducing the likelihood of insuring high-risk clients and ultimately lowering the loss ratio.

4. Increase New Product Growth

In an increasingly competitive market, carriers must differentiate by offering innovative products and services. Groundspeed empowers carriers to develop new insurance products by providing them with actionable insights derived from large volumes of data. With a better understanding of their clients’ needs, carriers can design customized policies and create new revenue streams. This helps them to stay ahead of the competition and achieve long-term growth.

Transforming Commercial Insurance for the Future

The commercial insurance industry has always grappled with the challenge of managing complex data sets, high operating expenses, and finding the right balance between risk and profit. Groundspeed is transforming the commercial insurance industry by harnessing the power of AI and advanced data analytics to help solve those problems. By enabling carriers to increase their quote-to-bind ratio, decrease the loss ratio, reduce operating expenses, and foster new product growth, Groundspeed is paving the way for a more efficient and profitable future. As the insurtech landscape continues to evolve, insurance carriers that embrace these technologies will be well-positioned to thrive in the ever-changing market.

If these results are goals for your business, we would be delighted to discuss how Groundspeed can partner with you to transform your underwriting process. Schedule a call today with a Groundspeed specialist to learn more about our Human-in-the-loop AI.