In our latest content series for P&C insurance providers, we discuss the five main underwriting challenges. This post dives into the first challenge: having high-quality data.
In order to remain competitive in a volatile marketplace, P&C firms must rapidly develop innovative business models and products while managing through disruptions (e.g., climate change, pandemics, etc.). This is vital since, according to a McKinsey analysis, cost performance has not improved in 15 years.
To achieve this flexibility, insurers must invest in digital transformation to stay competitive. P&C insurers will want to prioritize overhauling their complex, manual underwriting process. The same McKinsey analysis found the most successful carriers that have already done so leveraged the latest technologies to optimize their underwriting capabilities.
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To do this, insurers need access to better data.
In today's digital-everything world, all consumer activities create a data trail. Too often, this data is stored in disparate, unconnected systems (sometimes even within the same carrier's digital infrastructure). Unfortunately, data intake isn't always consistent, so underwriters are left with a mess that they have to clean up—manually. Sometimes they even have to go back to the client to re-retrieve the data. Data intake is particularly frustrating when underwriters cannot incorporate third-party data sources into their outdated systems and processes.
Analyzing and leveraging data is a core part of an underwriter’s responsibility. Imagine all the ways they can further benefit carriers if that data was better and easier to acquire. If underwriters are equipped with high-quality data, they could:
Negotiate with brokers more effectively for better pricing and terms
Incorporate new data sources that enable more informed risk selection
Quickly react to changes in risk demographics (e.g., age, urban versus rural environments, virtual/gig economy workers, etc.)
Leverage operational data to identify bottlenecks and guide continuous process improvements
Eliminate unnecessary data entry to streamline the customer journey and increase underwriting capacity
Even with all this time spent validating data, a Harvard Business Review study found that 97% of companies are using data that didn’t meet their own data standards.
Data quality is a persistent issue; per Forrester, analysts can spend as much as 40% of their time validating data relevant to their analysis before any outcome can be used to make a decision. Even with all this time spent validating data, a Harvard Business Review study found that 97% of companies are using data that didn’t meet their own data standards.
This falls in line with Accenture's findings that “most underwriting teams are not equipped to evaluate, select, and integrate the new data sources available.” AI and automation tools can be helpful, but the core is having the right information at the right time.
Unqork is reimagining the application development process to help P&C firms digitize the rate, quote, bind, and issue processes—enabling faster speed to market. Creating cleaner data internally and leveraging other trusted third-party data sources will improve underwriters’ trust in the data. This can be achieved by:
Eliminating manual data entry: Seamless third-party integrations means no more time-consuming manual processes
Reducing human error: All the data either comes directly from the customer themselves, or agencies are able to automatically ingest data from external sources at scale
Future-proofing: Unqork provides the ability to not only seamlessly integrate with third-party services that provide greater access to data, but also to add new services and functionalities as soon as they become available
Normalization: Data is kept clean and standardized to a common scale, without distorting any differences in the range of values
By tapping into the power of high-quality data culled from multiple sources, carriers are able to rapidly launch new products that will help your enterprise reduce processing times, cost, and administrative load by fully digitizing the customer lifecycle from quote request to proposal generation.
With Unqork’s enhanced ability to integrate with third-party services (such as Carpe Data and Groundspeed), P&C insurers can streamline the data collection and implement it into the Unqork platform that houses your completely digital underwriting application(s).
To learn more about how Unqork can be leveraged in your insurance organization, schedule a personalized demonstration with one of our in-house experts. Also, sign up for the Unqork newsletter and stay tuned into the latest no-code developments.