Future underwriters will need to be digital savvy

Future underwriters need a diverse set of digital analytical skills, according to a new report from the Chartered Insurance Institute (CII).

The report notes that traditionally skills required of underwriters were analytical in nature. As a result, sought after candidates mostly had STEM (science, technology, engineering and mathematics), business or economic degrees.

The group’s report, based on research that included a survey of Society of Underwriting Professionals members plus interviews with CUOs and HR Directors, found to be successful as an underwriter in the future a more diverse set of digital analytical skills is required.

Given the challenges around recruiting suitable candidates that satisfy both the analytical and behavioural aspects, the group’s research uncovered a growing school of thought that advocates for the splitting of underwriting roles, differentiating between technical and trading or development roles.

The group also claimed if the underwriting profession is to keep pace with the changing needs of consumers and businesses then insurers need to make targeted investments to enable the migration to a more future-forward technology stack now that can support a two-speed IT architecture alongside programmes focussed on talent acquisition and upskilling.

The report concluded that to make the underwriting profession fit for future purpose new and existing underwriters should adapt and develop new skills alongside their core underwriting abilities to effectively collaborate with data specialists. These skills include the understanding and use of pricing models, data analytics, portfolio management and data manipulation.

Upskilling should be the preferred method when there is enough time to plan, train and execute.

External recruitment, specifically for skilled hires, should be considered effective in the short-term when time to execution is critical and the suitable candidate needs to hit the ground running.

The group warn the ramification of failing adapt quickly enough to this changing climate of skillsets is insurers are not only likely to lose their staff but also to see the impacts on their top and bottom line.

Jonathan Clark, interim CEO of the CII said: “With the increase in use of data we are seeing a shift from underwriters being expected to detect and repair to consumers and businesses wanting the profession to help them predict and prevent risks.”

“Clients and underwriters alike will reap the benefits of data-driven methods of monitoring exposure and mitigating losses, as well as using ever enriched claims data to drive better underwriting decisions that legacy rating methods would measure short against.“