But what actually constitutes that disciplined underwriting? A group of industry professionals discussed that subject during a recent roundtable in New York, hosted by The Insurance Insider in association with AdvantageGo.
The 10 panellists who took part in the discussion were from across the (re)insurance spectrum – insurers, reinsurers and brokers as well as technology providers. These individuals worked in a variety of roles; a few were underwriters, others placed risks on behalf of clients while some worked in the innovation space.
The participants all had different answers to the question posed, and that highlights the complexity of the issue.
One claimed underwriting excellence is all about profitable underwriting, while another said “it’s also about saying no”.
The ability to make informed decisions was another interpretation, with one participant stating that “the key is information”.
The group accepted and agreed that reliable data is key to disciplined underwriting, and the use of such information will grow in importance in the coming years. At the same time, perhaps new and different indicators and data points are the answer to improving underwriting.
However, the group admitted concerns over pushing through wholesale change in the way underwriting is undertaken. As the old adage goes, no-one likes change, and the (re)insurance industry has been slow to embrace technology. Getting it to change the way it underwrites could be a slow and unforgiving process.
While on one hand you have an industry that is slow to push ahead with technological reform, on the other you have technology vendors who do not truly understand the (re)insurance market.
What makes matters worse for those vendors is that (re)insurance is not a single, homogenous entity – there are myriad lines of business and segments, each with their own intricacies and nuances. It should therefore not be too much of a surprise that the market has struggled to harness the technology theoretically available to it.
And further complicating the situation is the buy-in surrounding investment in technology. Companies making a big investment in IT to better understand the data at their fingertips may not see the benefits for a number of years.
In an industry that places so much importance on quarterly and annual results, the risk of scrutiny from management and shareholders is significant if investment does not start producing results in the near term.
The above only scratches the surface of what was discussed, so read on to find out what the group really thought constitutes “underwriting discipline and excellence”!
To view the Underwriting Roundtable 2019, please click here.
To visit the AdvantageGo website, click here.
Christopher Munro, Associate Editor, The Insurance Insider