How deeply should underwriting tasks be automated? As new technologies and standards emerge that make it possible to process underwriting decisions in a more automated fashion—with fewer touches by live human underwriters—debate is heating up across the industry as to whether increased automation may result in missed opportunities for insurance companies. Ultimately, it appears the answer may depend on the degree of complexity and the type of insurance being offered. For personal lines P&C policies, a high degree of automation is feasible; for more complex lines such as workers' compensation, specialty lines and life insurance, human intervention is still needed.

A survey of 146 carriers, conducted in early 2011 by Strategy Meets Action (SMA), finds that automation tools are seen as a way to augment underwriters' many manual tasks, but only about one out of four insurers have any intention of replacing underwriters with workflow, rules engine- and data and analytics-driven systems. About half, 46%, see such automation more as a way to augment and support underwriting processes and decisioning, while another 27% see technology as increasing the turnaround times of underwriters.

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