Jeff Van Kley, senior director at Willis Towers Watson, discusses how insurance companies can use cutting edge technology to address their data challenges
What technology trends do you expect to shape the insurance industry in the near future?
Advanced analytics continue to be paramount for the insurance world as data remains a key focus. We see a future that continues to be driven by analytics, with greater trust in analytics moving forward. To support this push, we also see the need for sophisticated technology, such as our end-to-end Radar solution.
Overall, the sophistication of models will continue to increase, with a continued push and pull between transparent algorithms (for customer centricity), and highly customised algorithms.
Why is data so important for insurers?
Data remains king – an insurer who can identify the latest and greatest data that will allow them to outcompete the market—and that no one else is using yet—will win. From our perspective, Radar Live allows carriers to easily integrate large amounts of external data into the pricing and underwriting process, during the quote process.
How has WTW's Radar Live stood out in this analytics-driven world?
Flexibility combined with transparency, as well as the ability to deploy complex rating algorithms with ease, distinguishes our solution from the competition. We provide an end-to-end solution that can integrate with policy admin systems—including home grown—and open source code.
From a data perspective, external data that gets pulled into Radar continues to be a key differentiator. Radar efficiently ingests external data and allows the user to incorporate it and see it visually.
Lastly, we offer the ability to deploy rates efficiently and quickly. It is the speed to market along with strong controls and governance around the rating structure that make our solution stand out.
Did you make any upgrades or improvements in the last 12 months?
We continually make updates to our software, integrating feedback from our client user base as well as our own user community. We target quarterly releases; with our most recent release providing enhanced governance with version control, faster processing times, and automatic feedback on predictive models.
Over the past few years, we have made continued improvements to Radar Live via integration with different policy admin systems, as well as adding GBMs (gradient boosting machine learning) and elastic nets to our predictive modelling suite. We allow integration with open source models (including Python and R) and continue to improve this capability with each release as we respond to market needs.
It's been a challenging environment in the last 16 months. How might Radar have assisted users in the last year?
During the past year, in addition to new challenges with collaboration with users working from home, we are seeing a continued scrutiny of analytical methods, the demand to quickly adjust to shocks in the market, as well as the ability to automate processes. Our Radar solution can help with all of these.
Collaboration has become much harder in the pandemic. You can't really go to somebody's desk to collaborate with them. And there has been a lot more interest in these control infrastructure solutions this year as it becomes harder to collaborate.
Radar has been particularly good in the way it deploys rates and has the control of model with governance. Everybody can pull up the Radar model and check rates. It allows users to make sure they are on the same page in knowing what rates are being deployed.
As regulators continue to scrutinise analytical methods, the flexibility and transparency Radar offers ensures that users can quickly create the support needed for regulators.
How do you keep pace with the increased complexity in the modelling world?
Not only do we invest heavily in R&D efforts, both in software and actuarial research, we also are continuously working to integrate the latest from the open source world into our work. Our tools fully integrate with Python and R. This ensures not only do you get more than 20 years of our software development experience and insurance-specific expertise, but also access to the latest developments in the open source world.
