New Business & Underwriting Process Automation in the insurance industry
- The underwriting process plays a crucial role in the insurance industry, involving the collection of extensive information from various sources and the evaluation of risks associated with insurance policies. Underwriters are responsible for assessing the risks posed by customers, their homes, or vehicles, and this information can vary significantly from one applicant to another. However, completing the underwriting process within the insurance domain typically takes an average of 2-3 weeks. Surprisingly, a staggering 18.8 million individuals worldwide have reported encountering difficulties in completing the task of data collection required for underwriting.
- Considering its lengthy nature, the need for accurate results, and its sequential characteristics, underwriting proves to be a perfect use case for the implementation of Robotic Process Automation (RPA). To better illustrate the significant role of RPA in underwriting, let's take the example of Auto Insurance. Auto Insurance Underwriters need to gather data from public records about the owners of vehicles. This data collection process includes various tasks such as verifying whether the driver is insured, checking for any previous claims filed through the Comprehensive Loss Underwriting Exchange (CLUE) with other insurance companies, and assessing the applicant's eligibility based on factors like criminal records or compliance violations. To accomplish these tasks efficiently, an RPA system is capable of leveraging public databases containing information on arrests, charges, and convictions related to motor vehicle incidents.
- Once an Auto Insurer applies, the RPA system can swiftly retrieve the necessary details from the application form and run them through the internal database. Subsequently, it can create a dedicated Customer Relationship Management (CRM) entry for the Auto Insurer under the relevant category. The system can then compare the applicant's records against the available public data, ensuring the absence of any discrepancies or policy violations. In this accelerated process, the RPA system can quickly determine the applicant's eligibility for insurance coverage within a short duration of time. Consequently, this automated process fast-tracks the overall underwriting process, allowing the underwriter to promptly analyze the associated risks and provide the insurance company with faster decision-making capabilities characterized by 100% accuracy.
- While the aforementioned example focuses on a specific aspect within the insurance domain, it underscores the immense potential of RPA in managing the high volume of daily applications received by insurance companies across various categories, including vehicular insurance, personal insurance, and home insurance, among others. By accurately gathering real-time data from external and internal sources at an impressive speed, RPA-equipped robots can run the underwriting process automatically, adhering to specific requirements. This not only ensures a 0% error rate in data accuracy also significantly frees up 30-40% of capacity, enabling more efficient resource allocation within the limited time constraints imposed by the underwriting process.
