This September brings to us ITC Vegas, which DRC is excited to attend and honored to be a Specialty Category Sponsor. This year’s ITC Vegas conference showcases many intriguing topics, including the future that insurers have to prepare for in light of newly expanding risks.
Historically, specialty insurers lacked automation assistance in comparison to their mainstream peers. However, insurtech has allowed specialty insurers to be more well equipped for the future as underwriters advance from getting away with generalizations to doubling down on the nuances of each risk a client faces. Here’s what the future of specialty insurance may look like and what tomorrow’s underwriters may demand.
Since the pandemic, companies have considered keeping their remote work policies to increase employee retention. However, the increase in remote workers has increased the risk for phishing, malware, and ransomware. Willis Towers Watson reports a 50% to 150% increase in cyber liability rates in 2022. According to a recent report by Aite-Novarica, this leaves specialty lines carriers overwhelmed as they keep up with demands. These risks are still considered specialized, but they are no longer uncommon.
In the past 20 years, humans have influenced 68% of all extreme weather. These volatile changes mean that historical climate data may no longer be reliable for prediction, and insurers must consider modifying their catastrophe models. Tropical diseases are more likely to spread to new areas, and natural disasters that have never happened before in some areas may occur once in a while. On top of these unpredictable acts of nature, insurers must also consider how to be more well-prepared for future pandemics.
Specialty lines must have the proper technological infrastructure in place to streamline the underwriting and modeling process to keep up with these expanding risks. Underwriting and product teams will have to be able to modify products on a much more frequent basis than they have in the past. Where rates and rules may be changed only annually today, future teams will have to react to fast-moving markets and data monthly and perhaps even weekly. DRC’s RS X Rating allows teams to move independently of IT and vendor resourcing and priorities, allowing teams to self-service change at the rate of business. Specialty insurers must prioritize access to new and emerging data sources and reporting tools that are cloud-connected to give them the near real time data needed to react to future markets. DRC’s microservice architecture and APIs include a highly configurable policy administration system and a robust rating engine that can enable product development flexibility and accelerate entry to profitable niches. In order for insurtech services to serve the future, they must allow underwriters to work with the interfaces that they are already familiar with so they can make decisions in the best interest for the client. The best product for one remote worker is not the best for all remote workers, and the best product for one beach house may not be the best for a cabin in the mountains.
Visit DRC at booth 2969 at ITC Vegas or email firstname.lastname@example.org to speak further about the future of specialty insurance.