This is a shortened version of Making Risk Flow podcast, episode 7. You can listen to the full episode here
In this episode Juan invited ex Hiscox SVP and the newest Head of North America at Cytora – Zaheer Hooda. They talked about the drivers behind Hiscox digital transformation efforts. In this brief chat they cover challenges of digitising and automating risk workflows , the path of achieving it at Hiscox.
Juan: Hello and welcome again to the Making Risk Flow podcast. Today, I’m joined by Zaheer Hooda, who until recently was the SVP in charge of data analytics and automation at Hiscox USA. In that capacity, he focused on the topic of digitising risks across a number of different workflows.
We are now very lucky that Zaheer has recently joined us to lead our North America operations at Cytora. It’s a real pleasure to have you join me for today’s episode. Would you like to start with a brief introduction of yourself?
Zaheer: Yes, thanks Juan. I’m extremely excited to be here and to chat with you. At Hiscox, I was the SVP for data on digital enablement. Digital enablement can often be a loaded term and for me there were three aspects to it:
Juan: Fantastic. We’re really glad to have to have you. You’ve mentioned you were quite focused on digitising workflows and risk at Hiscox. Perhaps we can start with talking about what were the main objectives you had in mind for those initiatives?
Zaheer: For us it came down to two different areas. One, how do you maximise underwriting capacity and two, how do you improve turnaround time? Let me let me dig into that a little bit. We all know there’s a lot of manual activities that exist out there, what I mean by that is prior to the underwriter taking it on, there’s often an underwriting assistant who’d try to facilitate. So there’s manual work there, but then even after the underwriter gets involved, we know that there’s sometimes manual and even at times repetitive work because of lack of clarity of who exactly is going to take this task on. The next piece, I would say is the underwriters are spending time on risks that they don’t necessarily quote. You could argue that it can be done in a more efficient manner by leveraging these emerging technologies.
And finally, the upside to this is outside of where you are today is how do you add more logic upfront in the process and everybody recognise that there is an opportunity for that. I’m talking about the automatic routing, the declination, the prioritisation etc. There’s clearly an opportunity there to drive more efficiency across the whole workflow.
Juan: Fantastic, the second area you mentioned was around reducing turnaround time. And that is actually something we hear very frequently from clients: “how do you provide better service to brokers? How do you let them know whether you’re going to quote or not?” And also how can you minimise the turnaround time so that end clients are not waiting days or weeks to get quotes back?
Zaheer: Exactly. I think we’ve even heard that there are links between speed to quote and the likelihood to bind. Of course it depends on product, business, there are lots of variables that you can dig into. But, there is a benefit to being able to have faster turnaround times.
Juan: Definitely. When you started with this initiative a few years ago, what were the major challenges you faced?
Zaheer: It was interesting for me because coming into it, I didn’t realise how complex these workflows are. Not only complex, but multidimensional. I’d say that was the biggest piece for me. There are variances by product, by type and maturity of process, the number of customer touchpoints or internal touchpoints. Those are just a few of the multiple components of that workflow. You have the intake, the triage, the appetite check, and then the underwriters do their own risk assessment etc. So I think the complexity, the fact that there are multiple aspects of each process was new to me. The obvious challenge was then trying to standardise and drive automation, which requires a bit of simplicity where possible.
The second piece is when you talk about these emerging technologies, it’s the art of orchestrating all of them together. You have the extraction up front, you might use OCR to be able to manage the structured and unstructured forms. You want to augment that, to learn even more about the customer and then you want to automatically see if there are other entity recognising services so it’s easy to find more data points on them. I think the most important thing is a user-friendly workflow. It’s not always about one simple workflow, it’s about how to create something that allows the underwriter or the underwriting system to be able to use this and be able to even hand over the exception parts of the normal flow that you’re expecting.
Juan: Yes, and is also something we see quite frequently, when some of our clients try to to make progress in this space, they realise how many different technologies are involved and how they need to be orchestrated upfront. Because you want to do all of this analysis as early on in the process as possible. So by the time a submission gets to an underwriter, all of the analysis of the risk has been performed.
Zaheer: The more you can get done upfront in the funnel, the better for the underwriter. Sometimes there are more complex risks where you have to accept thatt there will be relatively less information that you’ll be able to capture. But the opportunity is the key point, right?
Juan: Exactly. So it sounds like you started making progress internally with your own resources at Hiscox. Did you do this all by yourselves? Did you leverage any third party?
Zaheer: We did decide to approach it internally, but I want to caveat that and explain that a little bit. So first, building something like this in-house requires much more coordination and management as you’re trying to work on an unpaved path in the space. There’s a lot of trying and failing and I don’t think organisations always have the capacity and time to find that perfect orchestration of the process and the technology. So the short answer is you could do it internally like the way we approached it. But the good news is that I would say there are a handful of tech companies, not only Cytora, that exist right now that have been purely focused in this space.
And that’s why I’ve joined Cytora, in the past few years I’ve actually seen this space mature significantly. So you don’t necessarily have to figure this out all by yourself or in-house. There are players who specialise in this now within the industry, and I would say they have a lot of credibility and successes.
Juan: That makes total sense. If you look back and think about the progress you made at Hiscox and the success you drove, what would you say are the top three ingredients that are critical for success?
Zaheer: At the top of my mind is the ownership sponsorship aspect. So who is it that’s going to try to push to reach that optimal workflow process? And, how will they enforce all the stakeholders to make those calls? Because there are sometimes sticky topics that will come up in terms of underwriting, across operations, the regulatory impacts. You have to really understand, at least in the US market, you have to understand what you’re working with.
The second piece to me really is what are the objectives. What are you focused on when you say this? I mean, I think automation and digitization is a high level ambition. But if you take it one level lower, what are you solving for? Is it that you want to give the underwriting capacity, reduce internal touchpoints, the turnaround time, customer experience, what is it? And then through that, how do you really understand your process today?
There are often exception paths and sometimes those exception paths take up more time than you expected. Do you understand those? Do you understand your process performance baseline today? I think a lot of that we had do on the fly because we didn’t always ask these questions or push on them. So for example, if you’re looking for benefits of an automated process, where are you today? How many submissions are you getting done in one hour and where do you want to get to? Understanding those sorts of objectives and benefits, in combination with the ownership piece, would take you miles and miles towards success in at least the first iteration.
Juan: Definitely, that’s really insightful! What would be the advice you would give to somebody who’s embarking on this type of initiative? How do I create underwriting capacity? How do I reduce the quote turnaround time?
Zaheer: I’d probably keep it similar to what we just chatted about. First, ensure you have that clear objective. What are you solving for? Who is the sponsor, that executive sponsor, the decision maker, the owner that’s going to really push this over the line. The next, is understanding your process and optimising it if you need to. Before we talk about technology, if you need to lean out, understand the exception, perhaps do what’s necessary to be able to say “I understand how the process is working together today. I understand what can be and what can’t be standardised”
And then finally, I’d have to say, the biggest step is to not get overly ambitious for that first iteration. Take that one step. Automate and digitise what you have working already, and then in the next iteration add more underwriting prioritisation capacity or leverage external data to automatically predict X, Y, and Z. All of that comes in iterations versus trying to do all of that in that first iteration.
Juan: Yes, that really resonates with my experience as well. Some of our clients tried to do too much at once ie. deploy a solution and right away add completely new insights for underwriters to look at risks differently. And you cannot forget there’s a change management component to all of these. You need to over time, gain the trust of the underwriters. They need to understand that technology is making the right recommendations or decisions for them to help them. And to do that, our advice has always been to start with the data sources and the data you’re using today so there’s nothing really new to the underwriters.
Zaheer: It’s it’s funny that we talk about this, it is difficult because you get excited when you hear the prospect of the art of possible technologies and you want to add all of that, but at the same time you’re trying to minimise failure and ensure success and to ensure success it’s critical to get people involved.
Juan: Exactly, I think one of the main measures of success is when it’s the underwriters who, after having to use the platform for a few months, are the ones asking “how about we also use this type of insights to drive this type of decision? How about if we now tweak the appetite criteria to make it more granular?” Then it becomes an underwriting driven roadmap which is probably the number one driver for success at this time.
Zaheer: Even more ideal when the momentum just starts being pushed not only by you but by others in the organisation, that’s exciting.
Juan: Absolutely. By the way, this was fantastic, thank you so much for joining me today and I can’t wait to be working together.
Zaheer: Yeah, thank you Juan, pleasure talking.
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