Overcoming the Talent Shortage with Underwriting Software in Insurance

“The Industry is Undergoing a significant loss of underwriting expertise, knowledge, and resources, which makes placing business harder than ever"

Source:  Canadian Underwriter

The biggest challenge for most commercial P&C insurers isn’t inflation, higher reinsurance rates, or rising operational costs.  It’s attracting, training, and retaining underwriting talent.  

The combination of Baby Boomer retirements, InsurTech startups attracting college graduates, Millennials and Gen Z opting for careers in other industries, and insurers competing against each other to fill open positions have made recruiting and retaining underwriting talent tougher than ever.  

According to The Jacobson Group & Ward Group, 65% of P&C insurance companies added staff from July 2022 - July 2023 alone.  

And while Millennials and Gen Z view insurance as an antiquated industry, there is hope.  According to a study by The Institutes, 60% of Millennials found analyzing risks and recommending ways for companies to overcome them appealing. 

Attracting, Training, and Retaining Talent with AI

Unlike personal lines and small commercial lines, which are highly automated and digitized, the workflow for underwriting mid and large commercial lines accounts is paper-based due to the complexity of the risks.  

For underwriters to assess and price risk on new business submissions and renewals, they rely on making data based decisions that require manually reviewing, extracting, and rekeying information from emails, PDFs, and other types of docs, such as: 

• Supplemental Applications
• Statements of Value
• Loss Runs
• Financial Statements
• ACORD  Forms
• And more

These redundant inputs and manual processes are not only time-consuming, but they can also be frustrating, especially to Millennials and Gen Z, who feel technology should be used to make their lives easier.  According to Accenture, underwriters can spend 40% of their time on administrative tasks. 

This is why some forward-thinking commercial P&C insurers are using underwriting software to automate routine tasks to make underwriters happier and more productive.  For example, SortSpoke combines the power of AI along with your underwriter’s expertise to extract data from unstructured documents.

One of the benefits of combining AI + humans is that it takes feedback from your experienced underwriters, and it learns how to read and interpret complex documents.  This allows commercial P&C underwriters to extract the right data at the right time with minimal effort.     

Implementing AI into your underwriting workflow will not only free up your underwriters to focus on higher-value activities, but it will also make your organization more resilient.

Capturing Institutional Knowledge

According to the U.S. Bureau of Labor Statistics and the National Association of Mutual Insurance Companies, 50% of the current insurance workforce will retire in the next 15 years.  For commercial P&C insurers, this means vital underwriting knowledge is walking out the door and not being replaced. 

One of the advantages of AI solutions like Intelligent Document Processing (IDP) is that it allows insurers to capture the institutional knowledge of senior underwriters by having them train AI models on how to read and interpret complex documents. 

Typically, AI/ML solutions can start to accurately recommend what data fields must be extracted from complex unstructured PDFs in about 50 - 75 documents.  From there, AI/ML solutions can get fully up to speed after a day or two and will continue to get more intelligent as they’re exposed to different types of documentation.  

Accelerate Employee Training & Onboarding

Insurers are getting more creative by filling open positions with entry-level and junior-level talent.  One of the benefits of implementing AI/ML solutions like Intelligent Document Processing (IDP) is that new employees don’t have to learn how to read and interpret complex documents from scratch.  This enables new hires to focus more time on learning about coverage nuances between different types of businesses, process more submissions, and pick the brains of senior underwriters. 

Boost Employee Recruitment & Retention

Insurers who leverage modern technologies can attract more qualified talent and retain staff by upskilling them on using these technologies and setting them up for success.  For example, AI can automate manual and repetitive tasks so underwriters can spend more time on activities that support growth, including helping customers mitigate potential risks, developing client relationships, and underwriting more profitable new business submissions.

Using AI to Recruit and Retain the Next Generation of Underwriters 

Traditionally, commercial P&C insurers have been slow to embrace emerging technologies due to a complex regulatory environment and legacy systems.  However, a lot has changed over the last few years.  Today, insurers of all shapes and sizes are implementing AI/ML solutions into their underwriting workflows.  

The timing of this technology adoption couldn’t come at a better time as insurers look to recruit Millennial and Gen Z talent.  This generation grew up as digital natives and they expect to work with the latest technologies.  Insurers who use AI technology to automate administrative tasks will have a leg up on the competition when it comes to recruiting and retaining the next generation of underwriters. 

Along with helping carriers improve underwriting recruiting and retention, AI/ML technologies can also make organizations more profitable. Based on conversations with our customers, SortSpoke’s AI data extraction platform can help underwriting teams respond to new product launches or expand into new territories 2 - 4 quarters faster than before.

In addition, some of the other benefits our customers have seen by augmenting their underwriting staff with AI include:

• Boost to team capacity by 30% without adding staff
• Process incoming documents 5x faster than doing them manually
• Maintain 100% quality by keeping your experts in the loop
• Increase gross written premium (GWP) by 50%
  

See how SortSpoke can improve your underwriting process - Get a demo today