Novarica New Normal 100: Collaboration and Machine Learning Capabilities Important in Underwriting

We recently published the Novarica New Normal 100, for P/C and L/A, which covers 100 digital, data, and core capabilities for insurers across eight functional areas: product development, marketing, distribution, underwriting, customer engagement, billing, claims, and finance/operations.

The framework we designed applies to both life/annuity and property/casualty insurers. Our recent reports include analysis of data from Novarica’s study of 41 P/C and 17 L/A CIOs, which looks at current and planned deployment rates of each capability. Participants were asked to rate their current capabilities level in each of the 100 areas either mature (3), some (2), current or planned pilot (1), or no current or planned activities (0).

Digital underwriting capabilities focus on the internal workflow and collaboration environment, while straight-through processing, quick quoting, and routing capabilities are considered related to core systems within the framework. Data and analytics covers integrating data sources as well as using predictive modeling and machine learning/AI.

Within the L/A segment, digital capabilities are mixed. Workflow is widespread, but collaboration is uneven. In data and core, larger L/A insurers tend to have more capabilities and also report significantly higher pilot activity.

The P/C group saw pronounced gaps in internal and channel collaboration capabilities and in leveraging machine learning. Rates of adoption for predictive analytics in underwriting are comparable at 70-80%, but maturity levels are higher for larger insurers.

For more on the ever-changing insurance landscape, check out the Novarica New Normal 100: Digital, Data, and Core Capabilities for Property/Casualty Insurers and the Novarica New Normal 100: Digital, Data, and Core Capabilities for Life/Annuity Insurers.

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