How P&C Insurers Fight Inflation - How We Can Learn From It. This and more...

85% Increase For Customer Buying Experience - Munich Re's "Spark" Automation Solution

In India, Ageas Federal Life Insurance Co Ltd ("Ageas Federal Life") has implemented Munich Re Automation Solutions' ALLFINANZ SPARK, a cloud-based automated underwriting system.

Ageas Federal Life's shift to SPARK, mostly driven by the need to automate core procedures in an increasingly competitive market, will help the firm to increase its straight-through processing to 85%, providing best-in-class customer service.

Also, the company subscribed to SPARK's Analytics service, which provides out-of-the-box interactive analytical dashboards as well as modules to integrate, manage, and govern the usage of third-party data sources. Ageas Federal Life will be able to future-proof its company with these tools as the insurance market continues to migrate toward cloud-based AI and predictive underwriting.

More about the news - click here.

How US P&C Insurers Fight Inflation

Property and casualty (P&C) insurance providers are squirming as US inflation soars. Increasing claims prices and expenditures are wreaking havoc on almost every line of insurance. Rising prices contributed to an additional $30 billion in loss expenses in 2021, over and beyond previous loss averages.

Price increases for the products and services that drive personal insurance claims have been exceptionally high. According to the Insurance Information Institute, loss expenses in multiperil insurance lines, both personal and commercial, increased by $8 billion and $2 billion, respectively (III).

Key indicators as claims costs continue to rise

1. General Inflation - High general inflation generates an atmosphere that encourages assertive premium and pricing initiatives for insurers.
2. Claims Cost Inflation - Above and above general inflation, the most critical element for P&C carriers to monitor is claims expense inflation. Insurance firms must prioritize claims productivity and automation, as well as managed-care network use and negotiated price.
3. Wage Inflation - As the labor market continues to tighten, insurers must be on the lookout for increased wage pressure on total expense ratios. This will entail retaining discipline and transparency in spending management, as well as investing in enhanced productivity and digital self-service.
4. Interest Rates - Treasury rates and other returns will climb across the insurer's portfolio. This may alleviate some of the margin pressure generated by rising claims and wage inflation, allowing leading insurers with superior pricing skills to invest in market share growth.

What C-Suits Should Do to Improve Resilience

1. Chief Product and Underwriting Officers - Product and underwriting executives should concentrate on gaining as much knowledge into product profitability as possible. Underwriting executives will assign rate objectives to the least responsible individuals in the product or underwriting organization. Leading carriers are creating digital workflows that combine underwriting "judgment" with science through the use of data and analytics.
2. Chief Claims Officers - play a critical role in managing the end-to-end claim process. Insurance companies that achieve excellence in claims management will be more resilient to pricing pressures. Investment in automation and straight-through processing without manual input can contribute to driving down costs.
3. Chief Financial Officer - Insurers require a Chief Financial Officer (CFO) to help them balance growth and profitability. The primary responsibility of the CFO is to stress discipline in spending management, ensure insight into productivity, and allocate direct investment where the biggest improvements may be made.

Learn more on Mckinsey & Company's article.

Claim Factors for P&C Insurers

Touchless Claims

The usage of touchless claims, defined as the act of utilizing data from policyholders, agents, and others, as well as the use of artificial intelligence to automate the claims workflow, enables carriers to manage a claim without the need for any type of human intervention.

Claims Collaboration

Claims can include a wide range of parties other than the policyholder and their insurer, including as agents, vehicle repair shops, contractors, and attorneys. Many solutions seek to link and improve communication among different stakeholders in order to improve the efficiency of the claims process.

Fraud in Claims

Anti-fraud - When analyzing claims, insurers frequently encounter. At the time of the occurrence, insurers can identify and avoid fraudulent situations by analyzing information from the client and objective third-party datasets.

It is hard but I decided to leave Tel Aviv!

(Like a movie scene) Sorry Tel Aviv but I am leaving you - "Yes it is you and not me" :-)

Without a doubt, I love Tel Aviv, where I have achieved so many important personal and professional milestones. I have been considering leaving the city for months, and finally made up my mind.

We are all aware that living in Tel Aviv is among the most costly things you can do. Following COVID, real estate costs soared; the current increase from last year's expenses is 15.9%, the biggest yearly increase in home/apartment prices since the turn of the century.

So this is me packing up for our move to the suburbs - care to share some packing tips? Don't worry I will keep you updated about how's life on the other side :-)

Dear Insurtech and Innovation Friends,

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Best, Dikla ??