The Future of Insurance Underwriting Automation

The Future of Insurance Underwriting Automation

The Future of Insurance Underwriting Automation
Charles Munyi
Mar 31, 2022
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Insurance companies desire efficiency in their business operations. Gone are the days when every transaction involved filling out applications.

Insurance underwriting automation uses software, instead of human underwriters, to perform underwriting and risk assessment. Agents can now use software to determine the premium pricing and suitability for a policy. The result is a more accurate policy quote in a fraction of the time.

In this blog post, learn more about underwriting automation and the best underwriting software tools.

What is Insurance Underwriting Automation?

Insurance underwriting is the process of gathering and analyzing customer data to determine their eligibility for coverage and their policy premium. Insurance underwriting automation leverages artificial intelligence (AI), robotic process automation (RPA), and machine learning (ML) to map an insurance applicant’s risk profile to determine their eligibility for coverage. 

Underwriting software can track trends, analyze patterns, and spot anomalies. Insurance agents can enter various client risk parameters into a system, receive binding quotes from multiple carriers, and close the deal within a short time. Agents won’t have to deal with multiple forms or base their assessments on indications that aren’t always bindable.

Manual vs Automated Insurance Underwriting

Manual underwriting relies on human underwriters to sift through the paperwork, while automated underwriting leverages software to calculate the insurance risk a customer poses. 

Speed of execution differs greatly between manual and automated underwriting. Manual underwriting takes longer to complete, while automated underwriting accelerates the risk assessment and quote turnaround process. 

The ability to analyze patterns and track trends makes automated underwriting more accurate compared to traditional underwriting, which is prone to inaccurate risk assessments due to human error.

Insurance underwriting automation takes center stage with the need to assess large volumes of data. Artificial intelligence and machine learning systems can learn trends and identify fraud loopholes—common challenges in the changing insurance landscape.  

Benefits of Insurance Underwriting Automation

Underwriting automation software does what human underwriters do. If you’re looking for reasons to automate your processes, here are some benefits of insurance underwriting automation.

Faster Underwriting Decisions

Insurers can receive their insurance application outcomes faster through automated risk assessment, coverage determinations, and pricing calculations. Carriers can rapidly deploy, configure, and reuse underwriting best practices with shorter delivery times and improved quality. Insurers can also use predictive and adaptive analytics to compare past underwriting outcomes for consistency. 

Errors and Fraud Reduction

Addressing fraud at the insurance underwriting phase is crucial.  By consistently analyzing patterns in policy data, underwriting automation software can spot and flag any anomalies that human underwriting can’t detect. Machine learning software can refine its algorithms for more accuracy. It can also provide investigative guidance to help conduct further investigations.

Better Compliance

The underwriting nuances and regulations change periodically resulting in adjustments in the underwriting process. In manual underwriting, some of these guidelines could easily be missed. Automated underwriting ensures compliance by implementing any industry changes with a single algorithm tweak. 

Best Use Cases for Insurance Underwriting Automation

Underwriting automation is transforming the insurance industry, bringing speed and accuracy to companies. Agents no longer have to manually assess a commercial insurance application. 

With underwriting automation, your application is automatically pre-filled with existing data. The system may gather and analyze information from different sources to determine the insurance risk. The underwriting software will also pull your client’s business information from the small business administration or claims history database. 

Traditionally, the whole process could take weeks but automated solutions can significantly speed up data collection, data assessment, and internal system updates. Bots retrieve underwriting documents from emails, extract and classify the required information, and validate an insurance application for completeness and accuracy. 

Once the insurance application is validated, the underwriting system will generate an automated quote. Your client can pay their premium through the automated system and worry less about mailing a check every month. 

Best Insurance Underwriting Automation Software

Now is the time to explore what technology can do to improve your business. Below are the best underwriting automation software tools.

1. Pathpoint

pathpoint insurance underwriting automation

Pathpoint is more than underwriting automation software. We’re a digital wholesale broker with access to carriers in E&S markets. Our software allows retail agents to quote, bind, and issue small commercial E&S risks faster.

Pathpoint offers the best of both worlds–automation and a responsive support team. Receive multiple bindable quotes for vacants, contractors, cyber liability, and lessor’s risk only within 4 minutes and get access to customer support reps who can quickly answer your questions.

2. BindHQ

bindhq insurance underwriting automation

BindHQ streamlines the quoting, policy-issuing, and business-binding insurance process. Submit an insurance application and instantly browse bindable quotes from eligible programs and carrier agent portals within the system. 

Generate invoices and legal documents automatically and make payments directly through the platform. Insurance agents can combine the CRM and agency management system into a single platform. 

3. Instec

instec insurance underwriting automation

Instec software provides a friction-free underwriting process while reducing associated expense ratios. Its configurable rules engine can auto-process or auto-decline underwriting tasks.

It integrates with remote data sources for accuracy and better underwriting decisions. You can access the system 24/7 via the cloud or a mobile device.

4. Pega

pega insurance underwriting automation

Pega software accelerates underwriting decisions, quote turnarounds, and quote-to-bind ratios by eliminating manual workarounds. With cloud access, you can test, deploy, and manage applications from anywhere.  

Retrieve customer data from multiple sources in real-time while preserving its integrity. Monitor every customer’s context in real-time and use AI to determine why and when they are in the market. 

Try Insurance Underwriting Automation

Underwriting automation is the future of insurance. You can automate processes, like quote generation, data retrieval, payment processing, and claims tracking. Try Pathpoint for an instant, bindable E&S quote from multiple carriers.

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