Artificial Intelligence - November 10 2020
Underwriting leakage can erode competitive advantage, impact distribution channels, and impede growth. In a hardening market, insurers need to be able to capitalize on every opportunity that meets their risk appetite, be more competitive on preferred risks and maintain healthy loss ratios. Missed opportunities negatively impact a book of business, brand reputation, and customer relationships.
Evaluating how likely it is that the insured will make a costly claim and whether the insurer will lose money by issuing the policy, requires underwriters to use rigorous processes supported by vast amounts of data to ascertain the risk. Without access to the right data and the means to identify the right business that meets the risk appetite quickly and efficiently often results in underwriting leakage.