Adacta for Manager Wissen: The Underwriting Workbench of the Future: Precision Navigation for Insurance Professionals

The following text is the adaption of the original article published in the Risk and Roll: Underwriting in the Rythm of Change in Harvard Business Manager on 18 August:

In the dynamic landscape of insurance underwriting, the underwriting workbench serves as a central hub similar to a pilot's cockpit. It equips underwriters with essential tools to precisely assess risks and strategically manage them. Like a cockpit, it processes and enriches data, alerts to risks, and serves as an autopilot to automate processes and workflows.

Underwriting Workbench: A Short Overview

At its core, an underwriting workbench is a control panel where all the tools needed for underwriting policies come together in a single dashboard. Its goal is to support the entire process from submission to quote and bind while improving productivity, consistency, and effectiveness.

An insurance underwriter should be able to use a workbench to review insurance applications, assess risk, calculate premiums, manage specific clauses and conditions, and prepare and conclude a contract.

Regardless of its “data integration” nature, make no mistake: a modern underwriting workbench is not just a data feed. It has AI-based automation embedded at its core to help underwriters identify, understand, and manage risks.

The requirements and tools for managing complex commercial and specialty risks vary depending on factors such as line of insurance business, client size, and risk appetite. As a result, UW workbenches come in different flavours. A commercial insurance property-focused workbench must provide easy integration with external GIS systems in addition to the integration of more standard business and financial record services.

Therefore, a modern Workbench platform must be adaptable to ensure that it can be customized to different contexts. This provides insurance professionals with a versatile tool they can rely on. However, it also provides a standard set of capabilities and features that drive the digital transformation of the underwriting function.

Centralized dashboard for consolidating operations

The workbench brings together all the data, insights, tools, and tasks underwriters need in a centralized dashboard. This consolidation of resources in one place streamlines operations and ensures adherence to standardized pre-built workflows used to review submissions, prepare offers, manage clauses, and track tasks. This guarantees consistency and alignment with business policies, leading to more accurate proposals and enhanced portfolio management.

Automation to eliminate administrative overhead

Automation is another essential part of an underwriting workbench, where it works at several levels. First, automation tools are used to ingest and extract data from submissions. Then, AI-based tools augment and enrich data to improve its quality and then partially automate the insurance underwriting process in line with the business rules established by insurance carriers.

This is a critical area since data from McKinsey has shown that underwriters spend 30-40% of their time doing administrative tasks, such as rekeying data or manually executing analyses. This is a significant gain in the productivity of underwriters, who can now spend less time on slow manual workflows and more time analyzing complex risks.

Risk Management

As new risks emerge and existing risks evolve, insurers find it increasingly hard to capture and understand risk and impose their clauses for various regions and industries. AI models are crucial to help underwriters efficiently manage and compare their clients' demands and existing clauses, which are so complex that even the slightest changes in wording may cause significant losses to the insurers.

Capacity management

To ensure control over the risk that an insurer is willing and able to underwrite or assume on a given policy or portfolio of policies, a modern workbench seamlessly integrates capabilities such as real-time capacity tracking, quota management, compliance monitoring, reinsurance, and more into the underwriting workflow.

Collaboration

Once information is centralized and transparently organized, it fosters collaboration among all stakeholders, including other underwriters, agents, and customers. Workbench automation allows underwriters to track their activities and decisions better, driving efficiencies and improved results for insurers and clients. Another benefit is that senior underwriters can use their views to gain visibility into their staff’s tasks and performance, simplifying submission triage.

Improved compliance

The underwriting workbench also centralizes compliance reporting, while workflows and business rules ensure that each submission passes a compliance check as it is being processed. It ensures that risk is assessed accurately while creating a comprehensive insurance policy.

A feature-rich underwriting workbench

AdInsure Underwriting Workbench has emerged as a top choice for insurance companies embarking on the difficult journey of transforming and improving their underwriting operations. Since this is such a complex area, there is no single approach, and Adacta, the insurance company developing AdInsure, focused on specific building blocks that make up the workbench:

Process transparency. The underwriting process is impeccably transparent, offering a centralized view of all activities, decisions, and access to documentation.

Process automation. A rule-based system automates manual activities, freeing up underwriters to focus on added-value tasks.

Rating engine. A rule-based system that calculates insurance premiums by analyzing various risk factors and applying relevant underwriting rules and rating algorithms.

Streamlined integration. Easy integration with core and other systems to integrate information, records, and transactions to help insurers make better decisions.

Clause management. A clause library stores standard clauses available for AI-based automated selection of mandatory and matched clauses (coverages, partners) or manual selection.

Coinsurance and Reinsurance. Support for underwriters to distribute risk across multiple parties, optimizing their ability to underwrite policies without exceeding capacity limits.

Risk Questionnaires. A simple way to design Excel Questionnaires that can be easily embedded into the Underwriting process is by using no code configuration tools.

Advanced analytics and AI. Centralized data is easier to analyze for improved insights into risk profiles, claims analysis, customer segmentation, and insurance product performance.

Conclusion

A cockpit must provide the pilot with all information in a single place so they can act and safely bring the plane back to the ground. Like an airplane’s cockpit, an insurance underwriter’s workbench needs to give underwriters the data they need to assess risk effectively. Still, it must also serve automation features that drive efficiency and accuracy. Effective underwriting can mean a difference between profitability and loss, and there’s no reason not to empower your underwriting teams with the tools they need.

About the author

Michael Breidenband is the general manager of Adacta’s German subsidiary and a seasoned professional in the insurance industry. With his relevant work experience with core insurance functions and emphasis on standard software solutions, he ensures that AdInsure deployments meet the highest industry standards and deliver actual business value to Adacta’s clients.