With the third and final pillar of Solvency II coming into effect in less than ten days, PwC’s latest review of market conditions reports has announced the proportion of binder business expected to increase from 40% in 2016 to 47% in 2017.
However, as it currently stands, many insurers still execute their underwriting processes manually, rendering them woefully inefficient, inconsistent and full of errors. This is hardly conducive to profitability as time, manpower and budgets are misused on often unsuccessful efforts to clean and organised data into a format which complies with the strict new regulations.
Solvency II has re-set the bar when it comes to the data quality that binders are required to submit, with Lloyds announcing that organisations which fail to provide accurate data will be fined. With the inevitable pressure to modernise systems and to make them more transparent, the market is in desperate need of a more straightforward process.
“As 2017 draws closer, companies are recognising the challenges of meeting Solvency II’s tough regulations.” Says Richard Brown, Director of VIPR, “As a result, we’ve seen an increasing uptake of our Active Underwriter product as insurers seek to comply with the new guidelines.”
Quote & Bind solutions such as VIPR’s Active Underwriter offer insurers a fast underwriting method, with business instantaneously quoted online within pre-agreed parameters set by the capacity provider. This boosts efficiency while removing many of the risks associated with delegated business due to strict controls applied by these systems and subsequently, business can be rapidly rolled out to new agents. Fully integrated, it accommodates the end-to-end transaction of insurance business, in real-time, across Lloyd’s and international insurance markets and because everything is controlled within the system, it ensures compliance and automatically produces the reports required for Solvency II reporting.
The market is changing and Quote & Bind solutions will ensure the insurance industry is ahead of the curve, and, most importantly, able to write more business to boost profitability.