Life insurance specialist Tower feels technology investment is the key to staying a top four company in a market it expects will triple in value by 2017.
Speaking at the company's half-year results today, MD Jim Minto said he believed that four major players would emerge on the top of the life insurance market, all of which will have invested a bundle in technologies. Those who will have made these investments will make a barrier to entry, by forging links with business partners.
Tower's major technology investment has been Accelerate, an automated underwriting system that allows Tower distributors to access quoting, auto-underwriting and straight through processing, as well as management reporting on application tracking and commissions.
The company launched its portal in April this year after a nine-month pilot. Now, 85 per cent of insurance applications can be processed within three days using the platform, according to Tower.
With Accelerate, Tower didn't just put a computer underwriting model on the front end, it created a whole new business with its own business model, inside the existing operations, Minto said. The company wanted to "change the way insurance was written".
The response has been positive, according to Minto.
He said that with Accelerate, the applications mostly require no staff intervention on the part of the client business, helping them reduce costs.
Accelerate is built on an underwriting engine built on around 3,500 rules. Minto said it runs like a probability or decision tree: does the applicant have this? Yes, if no, do they do this.
Now the company wants to expand the system to more of the retail market and to groups, such as industry super funds, whose members might need insurance.
To stay on top of the game, the company hopes to upgrade the system next month.
"We expect that will become the way business is done pretty much," he added.