Surety Bond Quarterly - Summer 2017 - 32

Feature

INSURTECH
FOR SURETY:
THE FUTURE IS
CLOSER THAN
YOU THINK!

BY ROBERT M. COON
YOU MAY HAVE heard of Insurtech,
but what is it? Insurtech is "the use
of technology innovations designed
to squeeze out savings and efficiency from the current insurance
industry model," as defined by the
website Investopedia.
Imagine that you receive a large
contract bond request through your
agency web portal, which is forwarded to the surety through your
surety management system. The
underwriter approves it electronically, with the report of execution and
bond premium information automatically downloaded into your agency
billing system in seconds. The bond
form is populated by the information
on the request form-all that is left to
do is execute and deliver the bond.
Imagine that your client sends you his
or her quarterly work in process (WIP)
as an email attachment. You open it

32

with your surety management system, which instantly analyzes all the
jobs. This gives you the time to identify and address any areas of concern
before forwarding it to the surety.
These are both examples of
Insurtech in the surety world, and
if you attended the Innovation
Center presentations at the NASBP
Annual Meeting & Expo in Boca
Raton, Florida, you do not have to
imagine them. Some of the cutting
edge technology in development for
surety producers and underwriters
was on display. Sureties and software providers demonstrated system improvements based on the
developed ACORD and XBRL data
standards. ACORD is the Association
for Cooperative Operations Research
and Development, a global, nonprofit
organization serving the insurance
and related industries. The XBRL
data standard renders paper-based
information, such as the WIP report
and supporting financials, computerreadable, reducing costs and delays
and enabling data to be extracted
automatically into sureties' financial
systems without rekeying.
XBRL and The Hartford demonstrated the powerful benefits of using
data standards for WIP reporting. Due
to a slow internet connection, the WIP
analysis took a slow five seconds to

SURETY BOND QUARTERLY | SUMMER 2017

complete-a better connection would
have completed the analysis in a
fraction of the time. With the use of
data standards, the time it takes to
analyze a WIP report, whether it is
10 jobs or 1,000, is seconds-without
any errors. In comparison, inputting WIP data without standards is
a highly manual process, which can
take between 20 minutes to 20 hours
for a single WIP report. The Hartford
estimated that the cost of implementation will be recovered in just a few
months. The demonstration, which is
detailed in a case study (https://xbrl.
us/research/automation-improvessurety-underwriting-process/) highlighted the potential of XBRL data
standards revolutionizing the underwriting and decision-making process.
Marcum, LLP showed how easily converting an Excel WIP report
into an XBRL-formatted report can
be done. Liberty Mutual Surety and
Insure Vision Technologies provided
an example of how ACORD-based
standards can facilitate the bond
approval, execution, and reporting
process. The improved efficiency
benefits the agency, the surety, and
their mutual clients by reducing
response time and eliminating errors.
e-SURETY provided an eye-opening
live demonstration of submitting a
bond request on the ACORD request


https://xbrl.us/research/automation-improves-surety-underwriting-process/ https://xbrl.us/research/automation-improves-surety-underwriting-process/ https://xbrl.us/research/automation-improves-surety-underwriting-process/

Table of Contents for the Digital Edition of Surety Bond Quarterly - Summer 2017

NASBP Upcoming Meetings & Events
2017–2018 Executive Committee
From the CEO: Bringing Summer Heat: A Rundown of “Hot” Stuff in the Evolving World Surrounding Surety
Howard Cowan—Building on a Solid Foundation
Mitigating the Hidden Risks in the “New Normal” Construction Environment
Acting Director of the U.S. SBA Office of Surety Guarantees
Drones Take Flight in the Construction Industry
2017 AIA Contract Documents: Selected Key Changes
NASBP to Release Continuing Education Course: Joint Ventures in Construction
How Can Construction Contractors Expedite Payment on Federal Contracts?
Insurtech for Surety: The Future Is Closer than You Think!
Index to Advertisers
Surety Bond Quarterly - Summer 2017 - Intro
Surety Bond Quarterly - Summer 2017 - cover1
Surety Bond Quarterly - Summer 2017 - cover2
Surety Bond Quarterly - Summer 2017 - 3
Surety Bond Quarterly - Summer 2017 - 4
Surety Bond Quarterly - Summer 2017 - 5
Surety Bond Quarterly - Summer 2017 - 6
Surety Bond Quarterly - Summer 2017 - 2017–2018 Executive Committee
Surety Bond Quarterly - Summer 2017 - 8
Surety Bond Quarterly - Summer 2017 - From the CEO: Bringing Summer Heat: A Rundown of “Hot” Stuff in the Evolving World Surrounding Surety
Surety Bond Quarterly - Summer 2017 - Howard Cowan—Building on a Solid Foundation
Surety Bond Quarterly - Summer 2017 - 11
Surety Bond Quarterly - Summer 2017 - Mitigating the Hidden Risks in the “New Normal” Construction Environment
Surety Bond Quarterly - Summer 2017 - 13
Surety Bond Quarterly - Summer 2017 - 14
Surety Bond Quarterly - Summer 2017 - 15
Surety Bond Quarterly - Summer 2017 - 16
Surety Bond Quarterly - Summer 2017 - 17
Surety Bond Quarterly - Summer 2017 - 18
Surety Bond Quarterly - Summer 2017 - 19
Surety Bond Quarterly - Summer 2017 - Acting Director of the U.S. SBA Office of Surety Guarantees
Surety Bond Quarterly - Summer 2017 - 21
Surety Bond Quarterly - Summer 2017 - Drones Take Flight in the Construction Industry
Surety Bond Quarterly - Summer 2017 - 23
Surety Bond Quarterly - Summer 2017 - 2017 AIA Contract Documents: Selected Key Changes
Surety Bond Quarterly - Summer 2017 - 25
Surety Bond Quarterly - Summer 2017 - 26
Surety Bond Quarterly - Summer 2017 - NASBP to Release Continuing Education Course: Joint Ventures in Construction
Surety Bond Quarterly - Summer 2017 - How Can Construction Contractors Expedite Payment on Federal Contracts?
Surety Bond Quarterly - Summer 2017 - 29
Surety Bond Quarterly - Summer 2017 - 30
Surety Bond Quarterly - Summer 2017 - 31
Surety Bond Quarterly - Summer 2017 - Insurtech for Surety: The Future Is Closer than You Think!
Surety Bond Quarterly - Summer 2017 - 33
Surety Bond Quarterly - Summer 2017 - Index to Advertisers
Surety Bond Quarterly - Summer 2017 - cover3
Surety Bond Quarterly - Summer 2017 - cover4
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