[00:00:00] Cameron Scott: Therefore, to succeed in this market, it is important to consolidate it into a single view. AI is only as good as the data behind it.
[00:00:08] Paul Lucas: Hello everyone, welcome to Insurance Business TV. And welcome to the special edition. As we look at and navigate the impact of technology data, and AI in particular, on the insurance industry, it comes as no surprise that this is one of the most attractive areas of the market. Well, we have real experts. That man is Cameron Scott, ISI’s vice president of sales and marketing. Cameron, welcome to Insurance Business TV.
[00:00:32] Cameron Scott: Thank you Paul. It’s great to be here.
[00:00:34] Paul Lucas: So let’s start with a little data. If possible. When commercial insurers and MGAs manage business across broker direct program channels, how important is it to consolidate that data into a single view of the book of business?
[00:00:48] Cameron Scott: The need to provide a single view of data is steadily increasing. There are countless ways that insurance companies receive communications from end-insureds or consumers. Therefore, to succeed in this market, it is important to consolidate it into a single view. We are definitely seeing growth in the MGA and program business, but in order to properly select and underwrite risks, we need to look further at the data when it comes from multiple sources. Fragmented data often comes in through uploads and accounting postings, which can be dangerous. This prevents leaders from responding quickly to changing markets.
[00:01:28] Paul Lucas: So what should private carriers prioritize in order to create such a unified view? And indeed, how does that foundation improve underwriting in reporting and improve the ability to apply AI?
[00:01:38] Cameron Scott: What really matters is a data strategy, and having a data strategy that supports the use of AI. Therefore, your data strategy might be to deploy a data lake or data warehouse to provide an integrated view of your various systems. Alternatively, the approach could be to migrate all existing data to a single platform with a similar data structure. The latter has been found to be the most successful in providing real-time data to insurers for proper risk assessment and in particular for the accumulation of the entire book of business to prevent over-exposure. This can be especially important at property lines. And even if insurance companies aren’t leveraging AI at scale yet, they’re definitely talking about it. And AI is only as good as the data behind it. A unified data foundation that follows a similar structure provides the greatest benefits for AI. And this benefit is seen across application, ingestion, application processing, not only generating underwriting insights across the portfolio, but also automating day-to-day workflows and mundane tasks, setting up for AI usage really starts with your data strategy.
[00:02:44] Paul Lucas: If you’re working with a legacy system, this isn’t really possible. Of course, many insurance companies still operate across multiple legacy systems and data silos. So what are the biggest operational or strategic risks of continuing with such a piecemeal approach?
[00:03:01] Cameron Scott: Well, beyond operational efficiency, that’s what matters. Manual workarounds, data rekeying, and duplicate work. There is certainly a missed opportunity in AI.
[00:03:12] Paul Lucas: If possible, continue with that AI theme. Of course, there’s a lot of discussion around AI, underwriting, and operations, but there’s also a fair amount of hesitation. So where is AI offering any tangible value today, and where is it more promise than reality?
[00:03:30] Cameron Scott: When it comes to AI, we are first and foremost focused on human involvement. And I think most insurance companies today definitely have policies in place that require human involvement around the use of AI. So we think this will enable teams to move more confidently and faster. So when you work at the forefront of the insurance policy lifecycle, whether it’s during submission, uptake through triage and prioritization, or providing underwriting insights, you can surface early risk indicators, highlight missing information, and quickly get that information back from future insureds. But it all involves humans. What is more promising than reality is the complete automation of underwriting decisions. If no humans are involved, the AI-generated responses are actually booking and binding the risk. We don’t see much of that today. And certainly, without human oversight, you wouldn’t want to push the AI’s decisions.
[00:04:31] Paul Lucas: Of course, from our experience working with carriers and MGAs, what tends to be the biggest barrier when trying to modernize these core systems, and really, how can organizations overcome this without disrupting their business?
[00:04:43] Cameron Scott: It can be very difficult to do that without disrupting your business. I think strong collaboration between the business and it is important in any of these projects. There will only be confusion. Business disruption may occur as part of these projects. But we do it with the efficiency in mind and the benefits we get after the fact.
[00:05:06] Paul Lucas: So looking ahead, how do you think expectations from brokers and policyholders will change over time? Indeed, what do insurers need to prepare to meet these demands?
[00:05:17] Cameron Scott: We’re seeing more and more demands from insurers, especially based on the news of continued advances in AI. I think it falls into four different categories: speed, transparency, self-service, and consistency. Insureds want faster quotes and faster decisions. They want transparency regarding underwriting status and communication throughout the policy lifecycle. Ideally, you’ll have self-service capabilities that allow you to access some of the information yourself, get real-time responses and consistency, and get the same experience across different channels, whether you’re engaging directly with the broker or through an MGA partner. We want a consistent experience, look, feel, and access to information.
[00:06:01] Paul Lucas: You are sure to see some fascinating scenery. And Cameron, thank you very much for taking your time today and, of course, for listening. See you next time on Insurance Business TV.
