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Life and P&C insurers to accelerate automation use over the next five years

5th August 2021 - Author: Staff Writer

A new survey by Willis Towers Watson suggests global life and property and casualty (P&C) insurers want to improve the efficiency and auditability of their processes and close the gap between their current use of automation and where they aspire to be in five years.

technologyThe survey quesrtioned life and P&C insurers on how they use automation today in their valuation (life) and reserving (P&C) processes and where they aspire to use it in the future.

“Insurers are looking to transform actuarial processes to achieve greater efficiency and efficacy, enabling more granular analysis and more frequent and timelier insights from their data,” said Max Drannikov, Global Product Leader, Business Process Excellence, Willis Towers Watson.

“Unfortunately, achieving this is a challenge due to several barriers, including limited time, staff and poor data quality. To achieve their objectives, the first step for insurers is to leverage automation to create the time and space necessary to invest in and achieve their ambitions.”

Most life companies queried in the survey said they currently use either ‘no automation’ or merely ‘some automation’ and conveyed that assumption processes were their least automated core areas of a valuation process, while data processes have seen the greatest investment to date.

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P&C insurers echoed the same sentiments that they also currently use no or some automation and revealed that engagement with senior management was their least automated core area of the current reserving process, while data processes were the most automated function.

“There are significant opportunities for life and P&C insurers to embrace automation,” said Drannikov.
“We have seen life insurers gain value from automation around model point grouping, allocation of IFRS 17 cohorts and economic capital processes. Many challenges P&C insurers face stem from reliance on multiple data sources and coordinating external/internal teams — they can combat this by automating data processes.”

According to the survey, the life industry aspires to deploy ‘some’ or ‘strong’ automation over the next five years with assumptions, audit trail and results production the top three core area of the valuation process where they will focus.

The P&C industry also aspires for some or strong automation over the next five years with assumptions, audit trail and senior management engagement the top three core areas of future focus in the reserving process.

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