FirstBest Underwriting Survey Identifies Data and Analytics Opportunities and Challenges for Insurers

Only 11 percent of carriers surveyed are satisfied with current underwriting data and analytics capabilities

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Sep 30, 2014, 01:13 ET

BEDFORD, Mass., Sept. 30, 2014 /PRNewswire/ -- FirstBest® Systems, Inc., provider of collaborative underwriting solutions for U.S. and international carriers, today announced highlights from an industry survey on the use of data and analytics in the underwriting process. Among the topics examined were access to data, spend on data and analytics initiatives, and barriers to ROI from data and analytics investments.

FirstBest surveyed a cross section of respondents from both commercial and life/health insurers. Participants included carriers of various sizes representing management, underwriting, business operations, and IT.

The FirstBest survey revealed a notable connection between the utility of data analytics and improved underwriting results — with 56 percent of those surveyed stating that superior data access can directly lead to profitable underwriting. According to respondents, other benefits from data use are better decision making in underwriting (49 percent), and improved underwriting quality (35 percent). Despite the importance of data and analytics noted by survey participants, only 11 percent of carrier respondents indicate satisfaction with current underwriting data and analytics capabilities, and 89 percent indicate dissatisfaction to varying degrees.

"Insurance carriers are increasingly incorporating data assets in their underwriting processes, but they are also often impaired by the task of prioritizing and integrating a sea of data for productive risk assessment and submissions," said John Belizaire, FirstBest CEO and founder. "In fact, carriers are increasingly relying on dedicated, rules-driven underwriting workstations at the point of decision — and in collaboration with policy management systems — for actionable data and predictive analytics to help increase the speed and quality of risk decisions in mission-critical underwriting."

Among the many detailed findings of the 2014 FirstBest Underwriting Survey:

Underwriters are not accessing appropriate data for risk assessment. Carriers were asked: "What percentage of your underwriters has access to data and analytics tools?" and 43 percent of respondents observed that less than half of their underwriters have access to appropriate analytic tools in their current front-office technology setting.

Many carriers are investing heavily in data and analytics tools today, but the investment does not necessarily return the desired data-driven results for prompt and precise underwriting. More than 60 percent of carriers surveyed acknowledged higher spending on data and analytics capabilities in 2014 compared to 2013. But when asked: "If you had a magic wand, how would you use data and analytics to benefit underwriting?" 75 percent of the survey participants indicated data and analytics quality, accessibility, and consolidation is a key need.

"As more and more data and analytical tools become available, insurers must determine not only what data they will use but also how and when they will use it," according to Belizaire. "Our recent survey and market experience validates that too often underwriters need to scour a variety of sources and systems to get the information they need. Particularly for complex commercial risks, underwriters must often manually seek and move information from one system to another in fragmented procedures that can lead to errors, delays, and disruptions in winning and renewing business."

The 2014 Data-Powered Underwriting Survey is part of an ongoing study program by FirstBest about insurance underwriting and front office workflows. To help drive industry transformation and innovation, FirstBest domain experts continually analyze and share front-office best practices and underwriting trends. Other recent surveys include Underwriting Efficiency , Mobile Technology for Insurance, Market Needs and Trends: Underwriting Management, and State of the P&C Market. FirstBest reports and survey results can be downloaded by visiting www.FirstBest.com.

Click here to download the FirstBest 2014 Data-Powered Underwriting Survey results.

About FirstBest
FirstBest^® Systems is the leading provider of insurance software solutions and services that help U.S. and global insurance companies improve underwriting profitability, scale their business, and achieve high service levels with agents and brokers. The patented and proven FirstBest Front Office Suite processes more than $14 billion in quotes and includes a modular underwriting workstation, mobile underwriting, an agent/broker portal, and upload applications. Leading American and international carriers such as XL Group plc, OneBeacon, Chesapeake Employers, Beacon Mutual, and ICW Group rely on FirstBest to improve underwriting efficiencies and quality. FirstBest helps insurers institutionalize risk assessment knowledge and best practices and empowers all constituents in the underwriting process to rapidly quote, collaborate, issue, and bind business on a single, data-powered, real-time platform.
To learn more, call 1-781-863-6000 or visit www.FirstBest.com.

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SOURCE FirstBest Systems, Inc.