Many property and casualty (P&C) insurance companies areheavily siloed. Over time, this has resulted in cross-functionalinefficiencies between and across underwriting, claims, cededreinsurance, actuarial, and finance. In the past, investmentreturns may have covered the costs associated with theseinefficiencies, but this is no longer possible given today'shistorically low interest rates. Couple this development with thesurge of information that is available today and the importance ofunderwriting efficiently at an "information advantage" becomesclear.

Current state

Many P&C insurers are in the process of transforming, orhave transformed, their policy administration, claims, billing, andfinancial systems, as well as their related data environments andoperational processes. While there are economic and technologicalreasons for these transformations (e.g., record levels ofpolicyholders' surplus across the industry, new and more robusttechnologies, etc.), the primary driver appears to be strategic:many P&C insurers realize that more insightful approaches todeploying capital in the highly cyclical marketplace will help themto more efficiently achieve their profit and growth goals whilemitigating risks (including soft market-related risks).

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