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A White Paper to Help Navigate the Gray Areas

December 14, 2014| By Mo Tooker | L/H General Industry, P/C General Industry | English

As many of you know, earlier this year Gen Re embarked on a journey to uncover the role of biases in decision making, particularly where it relates to underwriting. We are pleased to share a white paper that discusses some of our findings and recommendations.

This paper takes a more in depth look at the different ways judgment can be influenced by automatic errors of perception and categorization, and the role of (equally automatic) emotions in decision making.

Over the last few months, I’ve shared some of what we’ve learned about how our biases and mental shortcuts can lead us to make bad decisions. And it’s led to some great conversations with clients, many of whom grapple with similar issues. In fact those discussions are encouraging because we’ve found that recognizing the existence of bias in the underwriting process is a critical first step to doing something about it. There really is more to making better judgements than risk data and complex computer models.

The work we’ve done so far has revealed that much of what people see and think, and how people act, occurs at a subconscious level and is effectively invisible to what we might call our "thinking brains.” So, we’ve been trying to single out certain decision making biases that may influence the quality of our underwriting processes.

As I have gotten deeper into the subject, I realize just how susceptible I am to making the same mistakes about which I’ve been writing. Although I’ve developed an elevated awareness of the impact that biases have on decision making, I still find myself falling into bias traps. 

By sharing the science and some of the source material from our own internal work in the white paper, we’re hoping to engage a wider audience in the conversation. We’ve found many individuals are well-read on the subject and a couple of customers are already on a similar path to finessing their enterprise decision making.

Much of the work and "treatments" summarized in the white paper were implemented in pilot studies in parts of our organization. These pilot activities show early signs of success, so we’re embarking on the next phase - rolling it out across our Property/Casualty group.

We’re only at the beginning of our journey, but I firmly believe that the more minds we have thinking about the challenge of biased decision making in underwriting, the better off that we will be as an industry. Join the conversation - we look forward to hearing from you.  

Download our Whitepaper -  "The Human Element - A No Brainer" 


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