insurer of the future the future of commercial underwriting€¦ · society is shifting and...

Insurer of the FutureThe Future of Commercial Underwriting

Society is shifting and Commercial Underwriting is at the heart of disruption

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Data Availability & Processing

Power

Internet of Things

Episodic Insurance

Digital & Omni Channel Appetite

Sharing Economy

Blockchain and smart contracts

Regulatory ChangeTalent Constraints

Third Party Capital

Rise of Unpredictable

Events

Self Driving Cars & ADAS

New Market Entrants

New & Emerging Risks

Social Data

Peer-to-Peer

Insurance

Machine Learning

Rise of Disruptor

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Disruptors – New and ‘Old’Traditional Players

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Focuses only on core activities

Risk Averse

Operate on a stop-and-start

project cycle

Target core and closely related

markets (only)

Talk of “innovation”

Disruptors – New and ‘Old’Traditional Players

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Focuses only on core activities

Risk Averse

Operate on a stop-and-start

project cycle

Target core and closely related

markets (only)

Talk of “innovation”

Move to working legacy free

Challenge established norms

Focus on continuous

improvement

Create new markets

More responsive to customer

behaviour

Disruptors – New and ‘Old’Traditional Players

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𝑪𝒐𝒎𝒃𝒊𝒏𝒆𝒅 𝑹𝒂𝒕𝒊𝒐 =𝑳𝒐𝒔𝒔𝒆𝒔 + 𝑬𝒙𝒑𝒆𝒏𝒔𝒆𝒔

𝑬𝒂𝒓𝒏𝒆𝒅 𝑷𝒓𝒆𝒎𝒊𝒖𝒎𝒔

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𝑪𝒐𝒎𝒃𝒊𝒏𝒆𝒅 𝑹𝒂𝒕𝒊𝒐 =𝑳𝒐𝒔𝒔𝒆𝒔 + 𝑬𝒙𝒑𝒆𝒏𝒔𝒆𝒔

𝑬𝒂𝒓𝒏𝒆𝒅 𝑷𝒓𝒆𝒎𝒊𝒖𝒎𝒔

10 | Copyright © 2019 Deloitte Development LLC. All rights reserved. Source: Deloitte Analysis on Loss Ratio based on 2017/2018 Published Reports

50.0%

55.0%

60.0%

65.0%

70.0%

75.0%

80.0%

85.0%

Lo

ss R

ati

o

There is a 30 point gap across comparable commercial lines underwriting in the UK

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Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

12 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

13 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

14 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

15 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

16 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Six capabilities for the Future of Underwriting

Customer Led Adaptable Empowered Organisation

Data Driven Machine Powered

Insight Driven Pricing On Demand Flexible Products

17 | Copyright © 2019 Deloitte Development LLC. All rights reserved.

Adaptable Empowered Organisation

Machine PoweredCustomer Led

Enabled by

Data DrivenOn Demand Flexible

Products

Insight Driven Pricing

Key O

utc

om

es

Straight-through quote-to-bind

Policy Management

Underwriting & AnalyticsTriage and Assignment

Customer Management

Policy management efficiency

Pricing optimisation

Customer

insight

Strategic new business intake and

selection

Data and automation-enabled underwriting

Nimble and accelerated execution and adoption of change

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Underwriting and

Distribution

Example Problem

Statements

• How do we meet our customer expectations around a seamless personal lines-esque experience in the SME Space?

• How do we enhance our capabilities in the e-traded space?

• How can new technologies fit in with the like of software houses (e.g. real time pricing / decisions)

SME Mid MarketLarge

Commercial

Volume

Delegated

Complexity

• How do we optimise our broker relationships?

• How do we identify profitable segments cost effectively?

• How do we face off to the low quality data often seen in the mid market such as UK Regions?

• How do we best adapt our new underwriting model around LM TOM / similar initiatives such as PPL?

• How do we best leverage “underwriting intelligence” at pace on complex cases?

• How do we gain more insight and control, whilst empowering our coverholders?

• What tools and capabilities do I need to equip my affinities and coverholders with in order for us both to be successful?

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New Markets / New Co

Cost Efficiency

Protecting the existing book

Meet Regulation

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Copyright © 2019 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited

Thank you.Jack WhalleyContact: jackwhalley@deloitte.co.uk

Nigel WalshContact: ndwalsh@deloitte.co.uk

Mahima AgarwalContact: mahimaagarwal@deloitte.co.uk