Automated Underwriting and the Future of Insurance Technology

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Automation is primed to revolutionize the future of the insurance. One of the areas of the insurance industry that will feel its effects strongly is in claim underwriting. Automated underwriting presents new opportunities, as well as challenges, that Mendix’s application platform can help digital insurers to anticipate and attempt to control.

What is Automated Underwriting?

Automated underwriting is a decision for a claim underwriting that is generated by computer software. Typically working off of an algorithm, automated underwriting in insurance systems use data from credit history and insurance telematics to reach a decision and often an accompanying interest rate. The decision from an automated underwriting is the first step in applying for an insurance claim or the like, where a manual review is usually called for next to check for quality assurance.

There are plenty of advantages to using an automated underwriting system in place of a fully manual process when working with claims management software. Each of the advantages of claims processing automation described below can be realized by investing in a PaaS solution like the one Mendix provides. Mendix empowers digital insurance companies to develop all kinds of different enterprise applications for both consumer and internal use, with automated underwriting only being a single example.

Built-In Claim Tracking and Reporting

Insurance systems that use automated components are able to keep track of the claim throughout the entire process. Alert systems and automated reports are examples of built-in functions that ensure claims are kept on track. Additionally, sending customer information or claim data from one insurer in a claims processing system to another is simplified using smart apps like the ones Mendix helps enterprises to develop. This streamlines customer service and keeps productivity at a high.

Product Insurance Innovation Opportunities

A digital insurer that has adopted an automated underwriting system also gains time, research, and resources to invest in the future of insurance. These new products can incorporate the newly automated processes or be a part of entirely new product sectors for the insurer, such as health insurance innovation. This increase in automation can also lead to expansion of existing products into new markets as automation often lends itself to scalability.

Paperless Application Processes

With greater automation in the application process, a digital insurer will have less paper to deal with after integrating an automated underwriting system. Giving up literal paperwork by using an application development platform or a Site-as-a-Service solution saves digital insurers from the time consuming process of collecting data on paper applications, reduces imaging costs, minimizes the number of manual handoffs and decreases human error. Additionally, with an e-application tied to an automated checking process, applications cannot be submitted half-finished and legibility is no longer an issue.