Insurance Surety: Are you Prepared to Navigate the New Digital Environment?
For insurers and brokers, struggling with older surety bond systems and processes in the digital world is becoming an increasing problem. Today’s cloud-based, digital world requires more flexibility, more adaptability, and more focus.
Fortunately, the insurance industry has a leg to stand on when it comes to these updates. There are lessons to be gleaned from previous experience—and there is plenty to discern about surety when we look around at the world of surety today.
The State of Surety Today
In the United States, construction is on the rise. And, as it so often happens with rising construction, demand for contract and commercial surety bonds has increased as well. That’s led to a favorable market for surety bonds—so long as the business can deliver on the promise of an expanding construction economy.
While the surety business is generally profitable, newer technologies can and should improve profit margins. Construction may be on the rise, but other economic factors point to a need for surety solutions to be nimble and effective.
Finding Solutions for Your Surety Challenges
If your organization is going to handle these surety challenges and take advantage of the increased demand that comes from construction, it’s going to have to be ready to meet that demand. But how do you stay “nimble,” and what does it really mean to be this flexible? Let’s look at a few points:
- The world’s economy is increasingly globalized, and with it, your technology solutions need to follow.
- Planning software acquisition costs will keep your costs down from the very beginning. Adopting a modern surety solution avoids typical Capex (capital expenditure).
- Paying per-bond-per-year subscription fees without separate licensing fees will have an impact on the overall expense ratio of your project. A subscription fee pricing model is a variable cost model and will have a positive impact on an organization’s expense ratio over traditional licensing models.
- With greater software flexibility comes greater budgetary flexibility, such as reducing or even outright eliminating the infrastructure and resource allocation costs of supporting your existing surety systems. Improving the workflow processes between the sureties and their distribution channels won’t only promote flexibility, but it can reduce expenses and ensure a greater amount of overall quality.
- Being nimble positions your company to acquire additional books of business at a reduced transactional cost.
Meeting the Future Challenges in Surety
If your systems or even your processes are due for an update, it means that there may be wiggle room in which you can realize more profitability for your organization. Keep the above lessons in mind when time comes to review these processes, and don’t be afraid to lead new initiatives.
Additionally, keep in mind that a subscription-based surety solution offers maximum flexibility and optimizes your processes. NIIT Technologies’ N-Surety is a solution you’ll want to be aware of in order to maximize flexibility and enhance the way you handle surety.
We invite you to review our one-hour webinar to learn about our subscription-based Surety technology solution that can improve the Surety’s and broker’s profitability and process optimization.