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The digitisation of underwriting

date: 28 March 2024
reading time: 8 min

The insurance sector is not immune to the transformative shift that is gripping the world and as a result, aims to leverage digital technologies to increase efficiency, accuracy and customer satisfaction.

Underwriting in insurance is a critical process that assesses risk and determines the premiums for insurable interests.

It’s a foundational pillar of the insurance industry, balancing the scales between profitability and risk management. With the digital age firmly upon us, the need for digitisation in underwriting has never been more pronounced.

Recent developments in artificial intelligence (AI), machine learning (ML) and big data analytics are paving the way for more streamlined and automated underwriting processes.

This is supported comprehensively in the industry through generous predictions of increasing growth in the sector, with Deloitte’s 2024 Global Insurance Outlook forecasting insurance underwriting’s 2022 market size of $81.5 billion increasing to $130.1 billion by 2027 – a compound annual growth rate of more than 9.6%.

This transformation is not just a matter of improving speed but also about enhancing the quality of risk assessment and decision-making.

In Future Processing’s latest installment of our IT Insights InsurTalk series, we met with Dave Connors, founder and CEO of distriBind, a digital data exchange (that is part of the Lloyd’s Lab) from London, UK, delivering automated back office processing solutions for every stage of the insurance lifecycle.

Dave began his insurance career by exploring a range of different departments, including working as an insurance technician and taking up roles in claims and underwriting. Dave has spent a lot of time working in delegated authority in his career, experiencing the ins and outs of risks, claims augmentations and reinsurance.

Having gained a full overview of both the successes and shortfalls of other insurance companies, Dave founded distriBind in 2018 and has navigated it to great success ever since.

In this article, we explore the insights gained in our discussion, including the significance of delegated authority and the critical role of data in the modern insurance market, as well as offering insights into the current state and future possibilities of underwriting digitisation.

The importance of delegated authority within the London Market

Delegated authority plays a pivotal role in the insurance market, particularly in London where it accounts for over 40% of the overall market gross premium.

This is not only true of London, with the global delegated authority premium reaching an incredible $100 million in 2020. This delegated authority arrangement allows insurers to outsource underwriting authority to third parties, enabling a more diversified and widespread risk-taking capacity.

The global scale of delegated authority underscores its importance, with the market for programme business in the US alone now approaching $100 billion in 2024, according to Dave Connors.

This model’s effectiveness in distributing risk and capital demonstrates the critical role delegated authority plays in the global insurance landscape.

Dave also offered a useful counterpoint to this notion; he mentioned the idea that it’s not always possible to externalise a particular data standard outside of this market, which is why this is a specific area that needs to go through a level of evolution in delegated authority in insurance – both in the London and wider global markets as a whole.

The insurance underwriting process – historic overview

Traditionally, the underwriting process, especially in the context of delegated authority, heavily relied on manual, spreadsheet-based methods.

Data was exchanged either monthly or quarterly, leading to delays and inefficiencies in risk assessment and policy issuance.

Typically, the MGA would sell the insurance policies throughout the month and then spend a week or two of the following month compiling the information about all the policies they had sold for that month to the brokers, who would then pass it on to the insurers.

In addition, the claims would also be included, further complicating this highly manual system.

This approach presented significant challenges in data accuracy, visibility and timeliness, and made things particularly difficult for insurers to make accurate connections between policies.

Nowadays, Dave explained that while there have been noteworthy advances, the process remains quite a laborious task that is still highly manual.

This slow pace of development further underscores the need for digitisation and automation in underwriting practices in these modern times.

The importance of data standards in delegated authority

According to distriBind CEO Dave Connors, the push towards establishing common data standards in the insurance industry has been a double-edged sword.

Dave explained that while internal consistency within organisations is beneficial due to its standardisation and internal consistency, the external imposition of standards on companies such as Lloyds of London can stifle innovation and flexibility, holding them to regulations and practices that may not always be optimal for their operations.

Quite simply, sometimes ‘a square peg doesn’t go in a round hole’, as the old adage goes. It is important for both insurance underwriting and delegated authority that the standards and practices applied to them are suitable for both the market and the individual company, and not simply applied because it worked well elsewhere.

The diversity of systems, processes and technological sophistication across the insurance value chain necessitates a more adaptable approach to data exchange. Recognising the need for flexibility rather than rigidity in data standards is crucial for fostering innovation and efficiency in underwriting processes.

The challenges in data ETL specific to delegated authority

The greatest challenge of unifying data standards is doing so in a manner that suits each company comprehensively.

Operations and requirements vary greatly between organisations, and whether they are smaller domestic brokers or larger brokers (such as those on the London market), the degree of manual, ‘paper-based’ operations still in place present significant barriers to a modern digitising world.

Insurance companies have now realised the importance of turning to digital solutions but the issues they are increasingly facing are how to apply technology to create a suitable, effective product.

Data comes in so many forms and there is not currently an efficient way to collate all of this data into a simple and functional system. In an ideal world, brokers worldwide would have access to a type of real-time API solution that could compile the data in an easy-to-read interface, noting trends, capabilities and opportunities for insurance.

However, for this to happen there would need to be a series of groundbreaking solutions found, not least a central digital platform that collates all the data in a single environment with an easy-to-analyse system interface.

The wide range of technological capabilities among MGAs, brokers and insurers requires a flexible approach to data integration and processing. Addressing these challenges is essential for improving data quality, visibility and operational efficiency in the underwriting process.

Delegated authority in the context of Blueprint Two

Delegated authority is integral to the vision outlined in Blueprint Two, Lloyd’s of London’s ambitious strategy to deliver profound change in the Lloyd’s market through digitalisation.

Blueprint Two seeks to be the ultimate digital solution in the London insurance market through the creation of a one-stop digital platform for insurance brokers all over the world.

Through a number of key phases, the first beginning on 1st July 2024, it aims to become a fully comprehensive digital insurance platform that will provide the full capability to support digital placement of risk through digitisation and automation.

However, Dave Connors is much more cautious when it comes to celebrating the success of Blueprint Two ahead of time.

He mentions that in order to succeed, Blueprint Two will require a departure from traditional approaches to data standardisation and exchange.

To be ultimately successful, Dave believes that Lloyds will need to adopt a more open-minded and flexible strategy that accommodates the diverse ecosystem of the insurance market, as this is essential for realising the benefits of digitisation in underwriting and across the insurance value chain.

Looking towards the future and “the art of possible”

The future of underwriting in the insurance industry will likely centre around digital and real-time data exchange via APIs, albeit at a varied pace across different market participants.

Whether or not Lloyd’s of London’s Blueprint Two will be at the central focal point of this solution remains to be seen, but it is likely to play a hugely pivotal role.

The transition to an all-encompassing digital solution will necessitate tools and processes that can accommodate a wide range of technological capabilities, ensuring that quality business is not turned away due to rigid tech standards.

The evolution towards a more digital, efficient, and flexible underwriting process is inevitable, driven by the need to better manage risk and meet the changing expectations of consumers and businesses alike.


The digitisation of underwriting is a journey that transcends mere technological adoption. It’s about reimagining the underwriting process to be more agile, accurate and aligned with the needs of a rapidly evolving market.

The insights gained from distriBind’s Dave Connors highlight the need for effective digital solutions in the insurance underwriting space but also underscore the challenges and opportunities that lie ahead.

As the insurance sector embraces digital transformation, the focus must remain on flexibility, innovation and the strategic use of data.

The path forward has its challenges, not least of all the question as to whether or not a single or multi-faceted digital solution is the answer, but one aspect is clear – a fully digital solution is required and this is the direction that the insurance must, and is, moving towards and the potential rewards for insurers, policyholders and the broader economy are substantial.

The digitisation of underwriting promises to redefine the insurance landscape, making it more responsive, efficient and capable of addressing the complexities of modern risk.

If you would like to watch our full interview with Dave Connors, CEO of distriBind, where we discuss the digitisation of underwriting and his thoughts on the strengths and challenges of making the digital transformation in the insurance underwriting space, please follow this link to visit our IT Insights Hub.

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