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Top Ways Technology Revolutionizes Insurance Underwriting

By Insurance CIO Outlook | Tuesday, November 05, 2019

Insurance underwriting is attaining new functionalities with the help of modern technologies.

FREMONT, CA: As the insurance industry looks to adapt to the new business ecosystems and deliver services in accordance with the expectations of millennial customers, technology is playing the most important role. Insurance underwriting is one aspect that has already seen a lot of transformation. As the sector navigates towards better operational efficiency, technology-backed insurance underwriting is all set to play a big differentiator. AI, automation, and analytics are changing the face of underwriting, and turnkey solutions are helping insurance providers realize the benefits of replacing traditional underwriting processes with advanced ones.

Some key ways in which current technologies are helping redefine insurance underwriting are listed below.

• Making Underwriting More Efficient than Ever

With AI, ML, and automation, insurance underwriting attains better capabilities, and the need for human underwriters reduces. It is AI that is at the core of insurance automation. The task of gathering and analyzing crucial data in real-time gets a major boost when data analytics is leveraged. Although technologies have advanced significantly since their early days, they cannot replace the workforce completely. Instead, insurance underwriting can benefit from augmenting systems with digital solutions. According to research, the global value of premiums written by AI is expected to amount to $20 billion within the next five years.

• Spotting Nuances in Underwriting

Manual underwriting used to be the norm until the emergence of modern technologies. However, several limitations have resulted from the manual ways, making the systems inefficient. With automation in insurance underwriting solutions, insurance companies have been able to overcome some of the challenges like time lags, and inaccurate quoting. Systems driven by intelligence are better at making nuanced, data-backed observations that are beyond human abilities. From detecting patterns to uncovering trends, advanced algorithm-enabled solutions do a great job.

• Enhanced Risk Calculation

Accumulating, categorizing, and parsing data sets to derive risk scores are becoming advanced. The ability to calculate risk is crucial in insurance underwriting. Risk calculation is not just becoming more accurate, but it is also becoming faster. This is resulting in the quick determination of quote and cover.

As business models evolve, underwriting should progress in tandem for the insurance industry to achieve success.

 

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