In today’s underwriting environment, carriers are constantly asked to do more with less, and do it faster. Underwriters need to underwrite effectively and price the right risks appropriately while simultaneously providing policyholders and agents/brokers with a great customer experience. It’s a constant juggling act.
Executive Summary
By tapping the vast amounts of external data now available, commercial insurance carriers can eliminate the need to request and clarify application data and concentrate on identifying and leveraging the factors that make the greater difference for loss projections. This reduction in "underwriting friction" creates a better experience for applicants/insureds, producers and underwriters, leading to improved operating result and retention.That is why anything that streamlines data collection and reduces “underwriting friction” in the insurance submission process can be a “win-win” for underwriters and customers.
The good news is that the information required to underwrite a risk is more readily available from external resources. Carriers may not have to ask applicants for it, as they currently do as part of the typical submission process, if they can access it externally at the time of underwriting.
In some cases, carriers can entirely skip the back-and-forth process of requesting data, having producers and clients provide it, then seeking further clarification, and so on. By using external data whenever available, carriers may acquire more valuable information than they asked for in the first place and underwrite with greater efficiency. This already is happening in life insurance and in personal lines such as auto and homeowners.
