Point of View

Improving underwriting results through intelligent submission prioritization and triage

A model that takes the guesswork out of prioritizing submissions for underwriters

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There's an old adage that says the squeaky wheel gets the oil. This may work for a bicycle, but it doesn't work for insurance processes. If your submissions triaging procedure takes the squeaky wheel approach with brokers and has a first-in-first-out system, it's time for a rethink. Manual, ad hoc underwriting can be time consuming, inconsistent, and out of alignment with your business priorities. Even worse, it forces experienced underwriters to perform tasks beneath their pay grade, such as preparing files. This slows down their ability to make a quote or decline a case. What's more, if your underwriting team isn't looking beyond loss-ratio models to make their assessments, you may miss out on some real opportunities.

There's a better way to prioritize. It involves taking the following drivers into account to bring the best and most profitable submissions to the front of the line:

  • Probability of bind
  • Estimated premium
  • Estimated profitability
  • Underwriting effort
  • Renewal probability
  • Cross-selling opportunities
  • Quality of the agency relationship

In today's world, insurers who don't consider these factors are missing opportunities for growth. What's more, underwriters will spend too much time on activities that don't translate into profit.

This needn't be the case. Automating submission triage with analytics that evaluate all these drivers can deliver a rules-based approach that lets your business strategy dictate what to prioritize. This approach also frees up underwriting teams to put their technical skills to best use.

Building a more intelligent triage process

The first step is to develop a method for ranking and scoring business priorities. The best system integrates model results, test cases, and inputs from experienced managers to estimate bind probability, premium size, and profitability. This should also consider factors that are impossible to model, such as agency status and cross-selling opportunities. With the right tools, managers can adjust these priorities over time, changing scores based on state, class, or other factors, without significant new modeling.

Scoring this way can reveal useful trade-offs. For example, it can help you decide when to stop reviewing risks from poorly performing agents or show you how to measure a risk in a high aggregation zone.

A good triaging system should also ensure that the right person gets the right submission at the right time and that there's speedy follow-through. Analytics and business rules can help here, too. The system can assign activities to underwriters based on expertise, cost, and availability. It can even direct tasks such as file preparation, geocoding, class code determination, and report ordering to assistant underwriters. That means high-scoring businesses will get immediate attention and underwriters will be free to review risks with incompatible characteristics, such as large buildings with low total insurable values (TIVs).

Figure 1: Strike zone report


Underwriters benefit when they have a clear picture of what goes into determining scores. The right information, with multiple data points displayed graphically, can give them the guidance they need and can help direct their subsequent actions.

Here's an example of how this works:

  • Data indicating a low success rate tells an underwriter to work with the agent before making a quote that may not result in business
  • Excellent profitability in a particular class indicates the need for less investigation
  • The size of the circle shows higher TIV, an early indicator of premium size
  • Green in the circle indicates that the catastrophe aggregation level is in acceptable range

You can quickly and efficiently configure charts like these based on the data you have available and your business goals to give your underwriters a competitive edge.

The best way to illustrate the benefits of intelligent triage is to witness it in action. Here are three scenarios that demonstrate how it works.

Growing the business

Suppose a specialty carrier has a high number of incoming submissions and a set number of underwriters to handle them. The carrier knows that if it wants to keep growing and ensure submissions keep flowing, it will have to strengthen its relationships with agents. Yet its underwriters review less than half of all submissions, quote on just 20% of them, and only 3% are actively bound. It may even be the case that brokers never receive responses to some of their queries.

What can the firm do to address these issues? Improved triaging is the solution. An upgraded system can identify opportunities almost as soon as a submission comes in, targeting agents, geographies, and business types with the highest probability of success. What's more, submissions from larger agencies where relationships are especially important automatically go to the head of the line. Our studies show that these factors can increase business by up to 20% without requiring more from underwriters.

The pressure to maintain profitability

Now, let's look at a multiline business insurance carrier that's experiencing a drop in profitability and worries about being overexposed in catastrophe-prone areas. In this instance, a better triage model can incorporate total account profitability as a primary driver, with business rules that penalize excessive exposure while prioritizing high premium and bind ratio risks. Estimates indicate that by directing underwriters in this way you could lower the loss costs of new business by between 4–8%.

Trade-offs worth making

Finally, imagine a property insurance line within a larger business carrier. This group has to deal with complex trade-offs every day regarding profitability, growth, aggregations, agency relationships, new business classes, and territories.

Now, picture a triage system built around win ratios and loss costs that works in conjunction with experienced personnel. The underwriter management team could prioritize risks and trade-offs and could incorporate this information into a new working model. Managers would also get tools for adjusting these trade-offs. So if there's too much growth in a class code with limited experience, for example, they could tune the model to make it a lower priority.

The output from a model like this makes it easier to assess trade-offs. Sometimes a risk will get priority despite higher aggregations because other factors – agent relationships, profitability, and the likelihood of success – make the risk worth it.

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Working smarter, not harder

In all these cases, the new triage model solved a critical business need without putting additional strains on underwriting. Using triage tools builds real efficiencies in a key part of the underwriting value chain. It's one of your best options for stimulating growth and boosting profitability while keeping your operations lean.