Traditional notions regarding the role of underwriting have begun to be unravelled by the revolutionary developments in digitalisation profoundly affecting the (re)insurance industry. Digitisation will help to reduce administrative paper work and streamline the underwriting process in a fundamental manner.
Proficiencies in IT and data analytics will become more crucial in gaining required professional knowledge to efficiently engage with emerging new risks such as unprecedented levels of natural catastrophe claims. This in turn will eventually catalyse a fundamental shift of the underwriter’s professional role from technical risk analyst to data scientist.
The use of data from all sorts of sources ranging from public records to satellite imagery to enhance the effectivity of pricing and loss reduction will pose key challenges to the industry. Some of the innovative solutions to adapt to these challenges will be algorithm-based underwriting and the application of cutting-edge technology in data analytics in the pricing of risks.
Insurers hope that, in the short term, AI can help to automate some of the administrative processes that are done manually — and expensively — at the moment. For example, the ability to pre-populate application forms with customers’ data would help to cut hours from the application process. In the long term though, there are other uses for the technology. “The low-hanging fruit is on the service side but they are quickly moving to underwriting,” said Mr Cusano. Claims processing could also be a target.
https://www.ft.com/content/a0d9aa8a-1494-11e7-80f4-13e067d5072c
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