Multiple industry headwinds and unconventional competitors have compelled traditional insurers to enhance their products, processes, and customer experiences. To drive recovery and ensure future growth, insurers are modernizing their IT infrastructures and prioritizing operational efficiencies and data-driven decision-making. However, increased market risks, rising claim costs, disrupted supply chains, and outdated processes are pressuring profit margins, necessitating a shift from insuring loss to ensuring protection. Generative AI can be valuable for insurers to enhance their RoI from modernization efforts and accelerate business value realization. Underwriting, in particular, presents significant long-term value-creation potential. However, while generative AI can transform several core insurance functions, firms must start with small, incremental steps to demonstrate business value before scaling up. Implementing generative AI with staggered investments can yield near-term efficiency gains, improve underwriting accuracy in the medium term, and transform the underwriting function in the long term. Scope Industry: insurance Geography: global Contents In this viewpoint, we: Examine the need for underwriting excellence to achieve business resilience Identify challenges and opportunities in the Property and Casualty (P&C) insurance underwriting space Assess data and generative AI’s roles in transforming the underwriting function Analyze generative AI use cases Recommend a generative AI adoption roadmap and discuss key considerations along the journey Membership(s) Insurance Information Technology Sourcing and Vendor Management

The Property and Casualty (P&C) insurance industry is undergoing a major transformation due to evolving customer preferences. This has prompted insurers to embark on digital transformation journeys, recognizing it as the need of the hour. Processes such as claims management and policy servicing are being automated, while underwriting, which was traditionally considered a core process, is also being transformed. Manual underwriting has been associated with issues such as poor customer experience, slow business growth, paper-based documentation, high operational costs, and pricing and risk issues. Digital underwriting applies a technology layer across the quote-to-bind cycle to create an automated future state. The role of underwriters in the future will change drastically, with skills such as risk management, collaboration, and data analytics taking a forefront in hiring decisions. All of this has significant sourcing implications, as insurers adjust to the evolving status quo while keeping their core competencies at hand. In this report, we explore the scope of digital underwriting and how it can help insurers achieve increased speed and efficiency, improved accuracy and risk management, enhanced customer experience, expanded reach, and reduced costs. Scope Industry: commercial lines and P&C insurance Geography: global Service: P&C insurance Contents In this report, we: Define the current challenges in underwriting Explore the applications of digital technology throughout the underwriting value chain Analyze the sourcing implications Outline underwriters’ key skillset Membership(s) Insurance Business Process Sourcing and Vendor Management

As the insurance consumption model evolves, insurers will need underwriting flexibility to set themselves up as risk guardians rather than risk assurers. Underwriting excellence will emerge as a catalyst to improve operational efficiencies and consumer experiences in the next normal. A shift in insurers’ mindset calls for an avant-garde approach to investments and initiatives around underwriting transformation across strategy, data, technology, and talent. The key outcome of a successful underwriting transformation program will be a shift from a one-product-fits-all approach to a customer-centric product development culture. In this report, we explore the changing market drivers in underwriting and the function’s potential benefits. Insurers should regard underwriting excellence as a continuous journey rather than an aspirational target state. In the near term, it will help eliminate inefficiencies and provide compelling customer experiences; in the long term, it will serve as a backbone to underwrite emerging risks and drive business growth. Scope Industry: insurance industry Geography: global Contents This report examines: Insurance industry dynamics driving underwriting transformation The urgency to attain underwriting excellence Implications of the evolving insurance landscape for insurers Reimagining the underwriting value chain for near-term gains Technology’s role in elevating underwriting standards in the long term Membership(s) Insurance Information Technology Sourcing and Vendor Management

In this research, we carry out a detailed analysis of the Property & Casualty (P&C) insurance industry, analyzing the forces shaping the industry’s future, especially in the light of the COVID-19 pandemic. We highlight the implications for key insurance functions and recommend strategies for P&C insurers to thrive in the next normal. The report also studies the industry’s IT services spend and provides IT outsourcing spend analysis by Line of Business (LoB), buyer size, geography, and IT services segment. Scope Industry: P&C insurance Geography: global Contents In this report, we study the following topics: Forces shaping the future of the P&C insurance industry Implications for P&C insurers in the light of COVID-19 and how they can navigate the impact A technology operating model to drive business transformation and set up P&C insurers for future success IT outsourcing spend analysis of P&C insurers across LoBs, buyer types, geographies, and service segments Membership Insurance - IT Services (ITS)