AM Best, one of the world’s leading credit agencies for over a century, releases a rating of global insurance carriers each year. In the past this score has drawn on a variety of metrics, mainly focused on an insurer’s creditworthiness and ability to pay claims over the long term. In 2020, however, AM Best introduced a new “Scoring and Assessing Innovation” report. This new report emphasized the importance of innovation to the financial assessment and long-term sustainability of insurers. The change essentially requires insurers to move beyond best practices and commit to innovation. AM Best’s two-part assessment measures innovation inputs (leadership, culture, resources, processes, and structures) and innovation outputs (results and levels of transformation).
The addition of this new report underlines the importance of Innovation as a core, guiding value in the modern insurance industry.
The challenge for insurers lies in drawing clear linkages between innovation, results, and long-term sustainability. Some sectors such as auto insurers, health insurers, and reinsurers have been stalwart examples of innovation in recent years, integrating new technologies focused on automation and digitalization, as well as more flexible management strategies. However, according to AM Best, only 13 insurers in 2020 earned the highest scores on output results, illustrating that actionable, sustainable results over a long period still have plenty of room to grow.
The issue with actionable, sustainable results seems to stem from the historical role of insurers. Insurers are legally required to be financially strong enough to pay claims, provide security and peace of mind to insureds. For this reason, insurers may be reluctant to invest in new technologies, fearing that the risk of failure in one business line outranks the potential gains in efficiency and productivity.
The Betterview Path
Betterview is a different kind of Insurtech, one that brings real insurance experience to leveraging technology to transform property insurance processes. We understand what is needed to transform property insurance into a more effective, efficient, and customer-centric business. We also know how important it is to property insurer partners to make the digital transformation quickly and efficiently in order to minimally impact their performance and sustainability.
When it comes to assessing an insurer’s innovation and long-term sustainability, Betterview’s point of view is that technology is more of a means than an end in itself. Technology is a tool that can empower insurance professionals to increase productivity, improve decision-making, and obtain actionable insights – those same innovation results highlighted in AM Best’s “Scoring and Assessing Innovation” report.
During COVID-19, the Property & Casualty insurers that partnered with Betterview continued to invest in intelligent automation, digital transformation, and improved customer experience. Those that made these investments in automation, digitalization, data analytics, and machine learning were better prepared to deal with the challenges brought on by the pandemic.
For example, COVID-19 greatly affected the ability of property insurers to put physical boots on the ground for underwriting inspections. Betterview worked closely with property insurers to provide the technological tools insurers needed to empower underwriters who were forced to work from home. Betterview’s platform used data analytics and machine learning to deliver actionable insights and better workflows to property underwriters wherever they happened to be located.
In a recent survey, 86% of Betterview’s platform users reported acting after viewing one of Betterview’s property profiles. One carrier saw a 20% decrease in roof-related losses after integrating Betterview into their underwriting systems, despite a 30% increase in wind events over the same time. Some even told Betterview they did not know how they would have survived the pandemic without Betterview.
Always on the lookout for more ways to improve customer productivity and experience, Betterview recently introduced PropertyAction, a fully customizable flagging system. The flagging system empowers underwriters to proactively set up unique alerts to help the underwriter address imminent risk hazards facing insureds in the path of wildfires or windstorms. Once an underwriter receives an alert, the underwriter engages the insurer, agent, and the insured in a conversation about how to manage the risks. These conversations encourage collaboration and build long-term partnerships between all concerned. The risk is mitigated, the insured dodges a bullet and gets a better rate, and the insurer’s loss ratio improves, thus affecting its long-term sustainability and resiliency.
To learn more about Betterview’s pathway to property insurance innovation and transformation, contact Dave Tobias, Co-founder of Betterview, at firstname.lastname@example.org