Life Underwriting and Information Technology
A crucial skill for success in insurance risk management is underwriting. It is a very complex decision-making process which involves the manipulation of many types of information on multiple levels. The actuarial design of the product, abnormalities that increase the likelihood of loss and the quality of the available data must be weighted and considered to resolve underwriting problems. This must be done in the context of a competitive market environment while balancing the expected claims with the expected investment income from the use of the pooled funds. Companies compete on product, price, financial strength and service. Underwriting plays a large role in the service aspect of the process of acquiring new business. Often the underwriting decision is based on incomplete and uncertain information. Nevertheless the quality and consistency of underwriting has a direct, long-term impact on the insurer’s bottom line, because the proportion of income paid for claims is greater than that paid to cover administrative expenses.
KeywordsIncome Marketing Expense Neurol Tral
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