2026-11-02 · Source: Insurance Thought Leadership
Summary in 3 Points • Pricing is crucial yet often overlooked, influencing profitability across millions of policies through outdated assumptions. • Kumarappan Sundaram emphasises the need for decoupling rating logic from core policy systems to enhance pricing efficiency. • Modernisation of pricing varies between personal and commercial lines, with the latter still relying on underwriter judgement. --- Pricing in insurance is a critical function that significantly impacts profitability, yet it often remains in the shadows compared to claims and underwriting. The current landscape reveals that many carriers struggle with outdated pricing mechanisms that fail to adapt to rapid market changes, leading to delays in implementing rate adjustments. Kumarappan Sundaram from PwC highlights the importance of decoupling rating logic from core policy systems, which allows for more agile pricing strategies and quicker responses to market volatility. The modernisation of pricing processes is uneven across the industry, with personal lines advancing more rapidly than commercial lines, which still depend heavily on underwriter judgement. Sundaram's insights suggest that before adopting advanced analytics or AI, insurers should first assess the time it takes to implement rate changes. This foundational work is essential for enabling more sophisticated pricing capabilities and ensuring that carriers can respond effectively to evolving market conditions. The need for decoupling rating logic from core policy systems is crucial for enhancing pricing efficiency in the London Market.
The need for decoupling rating logic from core policy systems is crucial for enhancing pricing efficiency in the London Market.