How to leverage data to thrive in spite of a hard market
In today’s webinar, we explored approaches to modernising underwriting, AI and machine learning solutions and how to embed data-driven solutions into the heart of insurance workflows.

This week, we spoke with Volker Muench, Chief Underwriting Officer Property General at AIG, Janthana Prakhamaroy, CEO of Tapoly, and Yaniv Bertele, CEO of Vesttoo, on the challenges and opportunities of underwriting in the current economic climate. 

We discussed approaches to modernising underwriting, AI and machine learning solutions and how to embed data-driven solutions into the heart of insurance workflows. 

Here’s what we learnt: 

In a hard market, margins are low and proper use of data is essential. Despite the varied verticals represented by the speakers, the consensus view is that understanding risk is more crucial than ever in a hard market. It becomes more difficult to underwrite for higher risk customers in a hard market, so to serve customers and to protect an insurer’s bottom line, it is vital to understand the precise risk circumstances. 

69% of our audience have seen their firm embed data-driven approaches into their underwriting process, 31% have seen little progress.

There is no one single approach to data innovation. Yaniv Bertele, with his background in end-to-end solutions, says that the industry should shift its thinking to consider how to integrate data into every stage of the underwriting process. Insurers should be creative about how they integrate this data – some will benefit from drawing in third party data, such as capital market data, for a more comprehensive understanding of risk. 

Digital techniques need to interact with human decision-making. Volker Muench points to large commercial property underwriting as a template for how digital underwriting techniques can interact with localised, human decisions. To fully understand complex, individual account underwriting it is vital to supplement with geospatial and AI-powered data solutions with anecdotal and expert evidence. 

32% have seen their firm significantly impacted by the hard market, with a further 59% seeing moderate impacts. 

Those who can survive in this market can survive anything. Janthana Kaenprakamaroy’s Tapoly has a number of customers who have been hit particularly hard by the pandemic – they cater to freelancers, sole traders and gig economy workers. In Kaenprakamaroy’s view, we have never seen a harder market than this. Insurers who preserve their key accounts while continually modernising their systems will be in a highly robust situation when a softer market arrives.

Matt Kenyon is a content producer at Insurtech Insights.

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