Now is the time to think about digital rating

Blog -- 22 March 2023

Author: Marketing

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Most carriers, MGAs and brokers will be well versed in the data and analytics capabilities evolving within the market and where their organization sits on the data maturity curve. But what about the digitalization of rating?

With modern tools available in the marketplace, brokers, carriers and MGAs no longer have to rely on spreadsheet-based rating models and emails to generate and exchange quotes, improving speed and efficiency at every stage of the value chain.

Rather than rekeying submissions into a portal for every carrier they want to work with, brokers can access rates from multiple providers within their own user interfaces. Carriers can configure common rules and pricing attributes in Rulebook enabling them to roll out – and adjust where necessary – rules and rates quickly and consistently to multiple delegated authorities and broker partners.

This is achievable through a rules-based pricing and distribution engine that digitises the rating process for specialty insurers end-to-end, from submission to bind and documentation. AI is harnessed to help underwriters more accurately assess and price risk across all major classes of business, automating many manual processes and augmenting risk data with external datasets and analytics.

As well as enhancing decision-making, this brings huge efficiency savings to underwriters and their partners. Using API integrations and an ACORD-compliant data standard, rates flow seamlessly between parties, enabling users to transact with multiple partners in a consistent language and elicit quotes in seconds. 

Pricing and rating engines can be deployed within an internal policy administration system (replacing Excel workbook-based rating models), be accessed as rating as a service (RaaS) and even underpin or integrate with agent and carrier portals and market distribution ecosystems; for example, Sequel Rulebook’s AI underpins the Marsh Intuitive distribution portal.

Market-leading MGAs are also adopting pricing and rating tools to replicate the system capabilities of their capacity providers – helping them demonstrate to carriers how accurately they can price and select risks and take the pen on behalf of multiple providers with much greater efficiency.

This digital approach frees up all parties to focus more resources on performance and growth. It opens a world of one-to-many trading – and brings the global insurance markets directly to one’s desk. It also breeds trust and accountability in the distribution chain.

In today’s world, providing better data and transparency to your stakeholders – be that an MGA to its capacity provider or a carrier to its reinsurers – makes you a better partner. Simply reporting a portfolio as profitable is no longer enough. It is essential to be able to evidence that rules are being adhered to; business is being written diligently; rates are being applied consistently; and if rate changes have been made, why?

Manual spreadsheets offer no audit trail explaining when or why rates were changed. Moreover, mistakes can easily be made using Excel and way too much time is wasted rekeying information – hindering agility and speed to market.

Sequel Rulebook tracks all changes and offers granular audit and real-time reporting capabilities, ensuring compliance from delegated authorities and giving capacity providers confidence and control over their portfolios.

By adopting a digital approach, underwriters can respond to changing market conditions and get new lines of business up and running quickly while also assuring stakeholders with a clear auditable history.

By speaking the same digital language, we can help to make our vast marketplace a cheaper, faster place to do business.