A Brief Introduction to Insurance Underwriting and Information Advantage

Many insurers have undertaken efficiency initiatives for various corporate functions over the years, including rules-based claims systems to control "claims leakage," finance transformation, IT and business process outsourcing, and others. Given the current challenging insurance market (e.g., soft rates, flat-to-declining nominal exposure bases, low interest rates/investment income, etc.) insurers are now starting to examine the underwriting function for opportunities to enhance underwriting decisions and gain efficiencies. PwC research has found that insurers that are able to consistently leverage a broad range of underwriting information could develop an "information advantage" over their competitors, and thus should be at the forefront of the industry when the underwriting cycle changes. This paper profiles underwriting information advantage capabilities by way of two case-based examples