5 Signs That It’s Time to Upgrade to an Intelligent Rating Engine

Is your enterprise rating engine powerful and flexible enough to meet the needs of today’s market demands?

The fact that many insurers are still using multiple policy systems – due to legacy, acquisitions, new business model launches, or lack of moving business to a next-gen solution – stand-alone enterprise rating engines are increasingly desired to externalize the rates, rules, and logic associated with a product to ensure ease of rapid or regular updates, flexibility and efficiency, consistency across the systems and most importantly, create speed-to-market.

Insurers and MGAs are scrambling to provide digital offerings powered by advanced analytics that can deliver policy quotes in real time. In doing so, many face these five signs that may indicate that it’s time to upgrade to an intelligent rating engine.

1. Your system response speed lags competitors – Agents and consumers are notoriously impatient. In the era of multiple, complex quote requirements for commercial and specialty insurance products, your rating engine needs to be flexible enough to return multiple rates, including any applicable riders and enhancements selected by the user, in fractions of a second.
2. Your product pricing does not match market demand – Your underwriting and pricing teams are excessively modifying the technical price in order to meet market realities. Your current pricing tools and processes prohibit nimble adjustments to keep your products top of mind for agents. A modern rating engine is capable of rapid updates, constrained only by your approval/compliance and release processes. The engine’s administration should also allow for complex workflows for approvals and release by multiple departments.
3. You struggle with validating rates — Your actuarial, underwriting, and compliance teams aren’t familiar with the inner workings of the platform and don’t have visibility into how rates are being calculated. Your engineering teams building the platform aren’t underwriting experts and don’t have the business knowledge required to test the accuracy of the system. A modern rating engine needs a validation component that helps management easily test whether the rates presented by your rating engine reflect the actual priced rates in the system (rounding rules, etc.).
4. Your “out of the box” rating engine must be repeatedly customized, leading to a poorly connected infrastructure and increased costs – This constant “reconfiguring” of the rating engine can lead to internal miscommunication, compliance issues, and system breakdowns. Customized, well-constructed rating engines are built to support the unique needs of your organization and can naturally adapt to changes in products, pricing, actuarial, and underwriting requirements.
5. You don’t have a process for seamlessly correcting rating engine errors – If your rating engine was not built with the input and oversight of engineering, actuarial, and underwriting teams, then it is difficult to rectify errors with all stakeholders. 

Majesco can exceed your goals and ensure you don’t run into these challenges through our Enterprise Rating technology.