In 2024, a P&C insurer study conducted by Capgemini suggested that 41% of the underwriters’ time is spent on “administrative and operational activities, constraining their capacity and triggering value chain challenges in pricing and broker/customer experience.”

Improving underwriter efficiency has always been a key driving force behind selecting an insurance platform. However, merely adopting a modern insurance platform is insufficient to address some of the current inefficiencies. To truly enhance underwriting efficiency, insurers now have the opportunity to select an insurance platform with built-in advanced AI-based automation and process optimization solutions. Furthermore, selecting a platform equipped with AI capabilities and partnering with a solution provider that is actively investing in AI technologies will not only meet current underwriting demands but also drive future productivity and innovation requirements.

With built-in AI-driven solutions, insurers can streamline operations, reduce manual workloads, and enhance overall efficiency, positioning themselves for long-term success in a rapidly evolving market. A modern platform working in cohesion with its own AI solution is the only way to achieve maximum efficiency and success.

Key areas where AI can bring substantial benefits include:

• Improving User Experience and Automation: AI-powered platforms can streamline and automate repetitive tasks, such as data entry and analysis, thereby reducing the administrative burden on underwriters. For example, Cogitate’s DigitalEdge platform has UW Assist, powered by CogitateLabs, which includes data ingestion capabilities. The AI reviews the input submission forms, automatically identifies the inputs for the submission through its powerful LLM models, and inserts data automatically into the application. This drastically reduces the manual administrative work for the underwriters and improves their user experience.
• Reducing Premium Leakage and Adverse Selection: AI can play a crucial role in minimizing premium leakage by identifying discrepancies and ensuring that premiums accurately reflect the risk associated with each policy. Moreover, AI-driven analytics can detect patterns indicative of adverse selection, where higher-risk individuals might be disproportionately represented. By addressing these issues, insurers can better align premiums with actual risk profiles and improve the financial stability of their portfolios.
• Prioritizing Work: AI can assist underwriters in prioritizing their workload by analyzing and sorting tasks based on urgency and impact. Intelligent systems can assess cases that require immediate attention and those that can be deferred, optimizing the allocation of resources and improving workflow efficiency. This prioritization ensures that critical tasks are addressed promptly, leading to better risk management and decision-making.
• Identifying Demands: Attorney demand letters are one of the biggest challenges facing the insurance industry. Any bad faith claim can have a significant impact, with settlements running into millions of dollars. Insurance companies have to deploy the manual process of reviewing thousands of documents daily to identify demand letters from attorneys. This is a time-consuming and error-prone process. With solutions like Cogitate’s DemandAssist, an AI/ML-based product, significant operational efficiency with an error-free process can be achieved.

Conclusion

AI-based tools are becoming a part of the work process, and proper adoption is key for an organization’s success and sustainability. To effectively leverage innovative tools, particularly AI-assisted solutions, it is essential to first build trust within your team. This involves gradually introducing these tools to address specific issues, consistently using and testing them, and measuring the improvements they bring. By demonstrating tangible benefits and success, you foster confidence in the technology and cultivate advocates for innovation within your organization.

Equally important is finding the right partner, like Cogitate, to support your transformation journey. Selecting the right solution provider who not only offers advanced tools as part of their insurance platform but also invests in ongoing innovation and support ensures that you have a reliable ally in navigating the complexities of modern insurance technology needs. This partnership is crucial for maximizing the potential of AI solutions and achieving long-term success in underwriting and beyond. Learn more about Cogitate at cogitate.com.

The post AI-Powered Insurance Platforms Boost Underwriting Efficiency first appeared on AAIS.

Introduction to Actionable Insights

Mayfield defined actionable insights as “curated data that allows the end user to make informed decisions and ask thoughtful questions.” He identified three key components of actionable insights:

• Business Focused: A collaboration between business units and IT is required to transform data from two-dimensional to three-dimensional.
• Clear Requirement Gathering Framework: A standardized approach helps streamline the process from request to report generation.
• Data Storage and Visualization Solution: Effective reporting solutions need strategies for easy data retrieval, transformation, and visualization.

Examples of Actionable Insights

Mayfield shared practical examples of actionable insights, illustrating how data can be used to make informed decisions. For instance, a claims team leader might ask, “How does average days to close impact my cost per claim?” This question aims to identify factors that can be controlled to improve cost efficiency. Another example involves examining the performance of underwriters by asking, “What’s the closure ratio of my top-performing underwriters, and which brokers are they working best with?” To pull out actionable insights, Mayfield explained, “You want to really look at submission data and get an idea of which underwriters are performing amazingly with certain agents, which may need some help, which agencies are providing equality results…things like that.”

Helping Carriers Make Informed Decisions with Data

To help carriers generate actionable insights, Mayfield emphasized the need to focus on the business problem and not the current limitations. “It’s about what the business wants,” he stated. Mayfield explained that actionable insights are rooted in addressing specific business questions and challenges. For instance, an underwriter might be concerned with increasing policy premiums, while a claims manager might focus on forecasting staffing needs based on task completion times.

Mayfield also highlighted the importance of frameworks and methodologies in generating actionable insights. One such framework that OneShield utilizes is the “BADIR” framework from the book Behind Every Good Decision. This framework helps bridge the gap between business questions and meaningful reports. It emphasizes the importance of understanding the goals of analysis and considering regional differences when generating reports.

Solutions to Evolve Reporting

Mayfield addressed the limitations of traditional reporting tools like Excel, highlighting the need for more advanced solutions. He recommended tools like Power BI and Azure Data Factory, which enable dynamic, interactive reporting and allow users to generate actionable insights efficiently.

Utilizing Core Systems for Actionable Insights

According to Mayfield, actionable insights require a core system capable of providing two-dimensional data that meets initial business needs from day one. Rather than focusing on regulatory requirements, he believes the emphasis should be on essential data needed to manage a business effectively. This includes policy details, earned premium, written premium, renewal rates, accounts receivable, and claims information such as average days to close and average cost to close. Mayfield advised this data to be available in various formats—by region, in real-time, monthly, or quarterly. “There’s a lot of different ways to view this data, and once you get there, you might want to mix and match the different elements to manage your business,” he said. But before advancing to three-dimensional reporting that provides tailored actionable insights, companies need a reliable core system for detailed data.

Leveraging Actionable Insights for Dynamic Analysis and Proof of Concept

When developing actionable insights, Mayfield believes it is crucial to understand that end users may not always know exactly what they need but will recognize valuable information when presented with it. For example, a claims manager might be uncertain about how to improve claim processing efficiency but will benefit from a flexible report that allows them to explore various data perspectives. In a given scenario, the manager might want to investigate how closing claims more quickly affects the overall cost of those claims. Mayfield explained that the report should provide detailed insights, such as identifying high-performing individuals like an adjuster who significantly reduces the average cost to close claims. Additionally, the manager might hypothesize that closing more claims within 90 days will reduce average costs. Mayfield added that the purpose of such reports is to allow users to verify their hypotheses through concrete data. “We’re no longer speculating about what the results are,” he confirmed. “We can now make informed decisions and go forward knowing that we’re building something that’s valuable, making decisions that we can back by data, and see results in areas that matter the most.”

To view the full webinar, click on the video above.

Questions? Please reach out to any of the featured speakers through the contact information below.

John Kadous

Vice President of Products – AAIS

johnk@aaisonline.com

John Dunn

Vice President of Sales, Americas – OneShield

jdunn@oneshield.com

Travis Mayfield

Reporting Product Manager – OneShield

tmayfield@oneshield.com

The post Webinar: Leveraging Core Systems for Actionable Insights in Policy Claims first appeared on AAIS.

AI Game Changers for Underwriters

With extensive industry experience and a keen eye on the evolution of technology platforms, particularly in AI and underwriting, Schaendorf identified numerous use cases for carriers, especially in underwriting and claims. She also sees significant potential in data access and utilization. Currently, data is often presented in static reports or dynamic formats, but AI has the power to transform how data is interpreted and interacted with.

Advancing Predictive Modeling in Underwriting and Claims Processes

In addressing the future of predictive modeling, Schaendorf explained how Cogitate focuses on its application in underwriting. “We’re looking at the profile of our risks, specifically the risk attributes that come in with each different type of client,” she said. While there are similarities in some variables, many are distinct, and Cogitate’s goal is to use these data attributes to build models that predict outcomes. For instance, Cogitate aims to determine the propensity for a loss ratio based on specific risk attributes.

On the claims side, the objective is to value claims accurately, especially complex ones. “It’s easy to handle the least complex claims, such as glass and towing in auto, but when it [comes] to a case that’s going to go to litigation, how do you set the reserves on that and what does that look like over the life of that claim?” Schaendorf proposed. “I see the ability to use that data and predictive modeling to get a little more accurate and a little better at it.”

Biggest Data Challenges Carriers Face and How to Overcome Them

According to Schaendorf, the biggest challenge carriers face when it comes to data is its structure and accessibility. While some data, like written premiums, policy numbers, and loss ratios, are well-structured, other types are not. This lack of structure poses significant difficulties in obtaining better, more accurate, and more useful data. To address this, Schaendorf believes it is crucial to foster a strong partnership between data professionals and top leadership within a company. “One group has one set of skills, and the other group has the business knowledge,” she explained. Although establishing these standards is time-consuming and may not seem immediately rewarding, they ultimately facilitate faster and more accurate data access.

About Cogitate

Cogitate was formed in 2012 by Schaendorf and her co-founder, Arvind Kaushal, as a digital platform operating on a software-as-a-service model. It is designed to streamline rating, quoting, binding, and issuance across all lines of business, including both commercial and personal lines. This modern-facing platform boasts numerous third-party data integrations, enhancing its functionality. “The proudest thing I can say about Cogitate is it’s an enabler,” Schaendorf shared. Cogitate has seen rapid growth and implementation success with their clients, processing a significant volume of quotes, binders, and premiums through the platform across various lines, such as commercial transportation, personal property, flood, commercial property, and professional liability. “It’s really facilitating growth for our partners, and that’s what we’re most proud of with the company.”

Learn more at Cogitate.com.

To view the full interview with Jacqueline Schaendorf, CPCU, click on the video above.

The post AI, Predictive Modeling, and Data Trends in Underwriting first appeared on AAIS.

Current and Emerging Inland Marine Market Trends

“The state of the inland marine insurance market is resilient, robust, and profitable,” according to Colson. “The industry demonstrated remarkable resilience rebounding from the COVID-19 pandemic and recent booms in building and transportation logistics have helped to drive growth.” In addition to collecting more written premium, which increased 14.3% in the U.S. inland marine insurance sector according to AM Best, Colson explained that the market space is enjoying an improving loss ratio, which fell from 63.8% in 2020 to 46.6% in 2022. “So, this translates into increased profitability and a combined ratio that is typically 10 points lower than the overall property and casualty market,” she stated. “And while inland marine insurance is a small portion of the P&C market, it’s maintaining strength and profitability.”

Colson highlighted several notable emerging trends in the inland marine insurance industry. “Inflation continues to be a hot topic and a concern shaping the industry, especially in this tense geopolitical environment, which was still rebounding from the COVID-19 pandemic,” she said. “The Russia and Ukraine war followed by the Hamas-Israel war have further complicated the inflationary environment. And as the cost of doing business climbs, it’s even more important to set an accurate valuation on items being insured.” Colson believes properly doing so can alleviate some of the effects inflation has on the increased cost of claims today versus five years ago.

Other trends include advances in an evolving technological landscape, like blockchain, artificial intelligence, and data analytics. “Innovations like these enable underwriters to become more efficient in the way they underwrite and are modernizing the way claims are managed,” said Colson. Another trend in the industry is a push towards sustainability. “While these trends are benefiting underwriters, risk managers, and claims professionals, they can bring new challenges with them, too,” Colson warned. “Some of these trends are opening doors to emerging risks, including cyber threats, and insurers may need to adjust how they provide coverage to address these risks.”

Effects of Climate Change on Inland Marine

Climate change is impacting inland marine insurance exposures in a variety of ways. One way is the rise in intensity and frequency of natural disasters. “These events are also transpiring across more areas,” Colson explained. “Flooding is no longer limited to just coastal areas. Convective storms, especially hailstorms, are also causing damage to solar farms in the Midwestern states, such as Nebraska and Texas. And this is happening with an increasing frequency.”

One tool Colson touched upon that insurers and reinsurers are using to assess the potential risks caused by natural catastrophes is catastrophe (cat) modeling. “Some newer cat models are beginning to emerge that are attempting to quantify the impact of future climatic risks,” she shared. “These tools can be used to make more informed decisions and to prevent property loss.”

Use of Data Analytics and Technology Tools

Colson explained that the inland marine insurance industry is advancing the use of data analytics and technology by leveraging data to monitor and improve the understanding of potential risks. “Inland marine insurance professionals are increasingly using data analytics to enhance underwriting risk assessments and claims management,” she said. “They’re also using it to streamline processes and improve overall efficiency.” Colson shared that industry leaders are also using telematics to help prevent or recover stolen insured items or to monitor behaviors such as the speed of trucks when drivers are hauling cargo.

What’s New at IMUA?

New developments at IMUA include the All Access Education platform, plans to transition to a new website as well as a new learning management system, and the upcoming Annual Meeting. “All Access Education provides all-inclusive remote education, including unlimited new and archived webinars, seminars, and classes as well as papers for every member at no additional cost,” Colson revealed. “This benefit has been incredibly successful with IMUA’s membership; registrations for remote education have tripled since the inception of this program.”

In fall 2024, IMUA will transition to a new website and database and implement a new learning management system that will give IMUA members a richer, more user-friendly experience with access to more education and an on-demand robust search engine.

Colson is also looking forward to the upcoming IMUA 93rd Annual Meeting on April 28-May 3 in San Antonio, Texas. “This year’s conference will kick off with a unique executive panel featuring industry views from three different perspectives: a broker, an underwriter, and a reinsurer,” she shared. “Other conference topics include recent court filings on a builder’s risk insurance claim, fictitious pickups and double broker loads, the oil and gas industry, convective storms and climate change, and modular construction.” IMUA is anticipating another year of record attendance for its Annual Meeting, with more than 325 individuals already registered. For more details and to register online, click here.

To view the full interview with Lillian Colson, please click the video above.

The post Inland Marine Market Trends, Climate Change Impacts, and Tech Innovations Ahead of Annual Meeting first appeared on AAIS.