Written by Tom Chamberlain

Automation in the specialty insurance market – how hard is it really?

Data engineering

2 minutes

Underwriting transformation specialist and VP of Customer, Tom Chamberlain, explores the state of automation in the specialty insurance market and solutions to maximise underwriter efficiency.

It was great to be in the City recently, catching up with some underwriting colleagues in the specialty insurance market. It’s always interesting to hear how things are going - the good, the bad and the ugly! This time, I was surprised to hear some of the latter headaches are still dominated by manual processes and data rekeying across what seems to be an increasing number of systems and spreadsheets. 

Automation has been a buzzword across the specialty insurance industry for many years, but why are we still hearing it? How hard can it really be to automate manual and repetitive tasks like data entry and rekeying? The fact we are still regularly discussing it today shows it is not, in fact, very easy at all. However, the potential benefits are enormous. A McKinsey study found that automation for insurance may reduce the data processing time by up to 34%.  

Personal lines and SME insurers are ahead of the game and have invested heavily in automation technology over the years. So, what are the barriers to automation for specialty insurers, and how can we overcome them to ensure we are not still talking about this five years from now?  

It’s important to first understand the context of this unique industry. Underwriters for specialty business work with tons of isolated data and spend lots of valuable time rekeying this data in multiple systems. Writing this reminds me of a time when I was asked to review and streamline some of a company's internal underwriting processes. I remember watching in fascination as an underwriter copied some information on a risk from a computer screen onto a piece of paper. This was then physically walked over to operations, who manually keyed it into another system. The scary thing is this did not happen that long ago! 

Aside from that extreme example, which I am happy to say was quickly resolved, there are many instances where we need to enter data into multiple systems that are not connected internally. Broker data needs to be keyed into policy admin systems, pricing tools, sanctions screening, and often Excel spreadsheets for reporting. Even then, before the actual underwriting can begin, third-party data needs to be sourced and entered into the pricing tool. At best, data can be uploaded directly or copied and pasted. At worst, data is manually copied from various websites or 3rd party systems, adding hours to each quote.  

The big issue here is that none of these systems or platforms is connected in any way. Insurers that have installed modern underwriting tools will have eliminated some of these problems - at least automating the data transfer between the policy admin system and pricing tools. Still, many other integrations remain in a long list of future enhancements. 

Despite all of this, automation can be easy and is game-changing when you get it right. Technology — particularly relating to pricing platforms — makes automation and integration simple, not just internally but externally too. API connections, combined with web scraping, can eliminate most manual entry and all rekeying, allowing underwriters to, well, underwrite! I have even seen this taken one step further with broker data automatically ingested and uploaded to the pricing platform, ready for underwriting and eliminating data entry altogether.  

So, to avoid the situation where we're still discussing automation in five years’ time, the initial solution is investing in and implementing the right technology. This is a digital transformation conversation, and it continues beyond just purchasing a platform. Taking the time to build out these key integrations will be the difference between simply having great tech and realising the value of becoming fully automated. 

Next generation platforms like hx Renew seamlessly integrate with internal systems and underwriter workbenches, eliminating data rekeying between policy admin systems and pricing tools and slashing overall quote times. With hx Renew's API ingestion capability, insurers and reinsurers can automatically upload submissions, generating a technical price before an underwriter touches the model, reducing the time for underwriters to respond to their trading partners.  

If you want to learn more about how hx Renew helps underwriters save up to 50% of time on the quote to bind process check out this resource or get in touch with the team.