Winning New Technologies – Munich Re report
Article Synopsis :
Improved technology, data availability and analytics tools have emerged as great enablers and now insurers are increasingly embracing automated underwriting as an engine for business success.
In the report titled “Winning New Technologies”, the Munich Re team highlight that underwriting automation has a strategic and a pivotal role to play in helping insurance companies reach a broader base of potential clients and grow their business profitably in the digital world. The report focuses on the automation of underwriting trends with some good examples of Asian companies and identifies the key imperatives for success. The report identifies the following six reasons why life insurers should consider implementing new business and underwriting automation:
- Fewer errors, faster decisions, lower acquisition costs, and increased sales
- Opening new distribution channels
- Reaching new markets
- Better customer service
- Better data, better decisions
- Speed with accuracy
The report also highlights three key macro technology trends that are impacting life insurance distribution which insurers must take into account when devising their new business strategy:
- The power of social media
- Big Data & analytics
- Mobile / Multiple devices
- Deliver compelling user experience across all devices
- Continually drive to minimise questions at the front end and use data smartly
- Increased agility and adaptability
- Actionable intelligence for all
- Choose your partner wisely
The Munich Re team conclude that underwriting rules engines are data facilitators, productivity enhancers, quality controllers and revenue drivers. They also enhance the underwriting process by allowing the right case to get to the right underwriter with the right information at the right time.
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Digital Insurer's CommentsThere is a compelling case for insurers to implement automated underwriting solutions as they can help with the often double-edged sword of curtailing costs and increasing revenues. On the revenue side, new business and underwriting automation can help insurers reach a broader base of clients and to grow profitably in a digital world. On the cost side, underwriting automation is designed to streamline business operations to increase efficiency and ultimately drive down costs.
In many of the more mature markets such as the UK and Australia, automated underwriting is standard practice, however in the majority of Asian markets, insurers are only just starting to consider automated underwriting solutions and to move away from the traditional paper-based approach. In our view, such solutions should form an integral part of any insurer’s digital transformation strategy as they are key component of re-designing a digitally-based business and operating model.
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