Costs insurers $0.35 per $1

Ty Robben wrote in a May 23 post that commercial insurance still spends $0.35 of every $1 of premium to produce two intangible outputs: an underwriting decision and a promise to pay claims. The post did not cite a public study, but it landed on a pressure point that carriers, brokers and software vendors have been describing for months: too much of the business still runs through email, PDFs and manual review. Commercial lines account for about half of U.S. property/casualty premium, according to the Insurance Information Institute, and the market is large enough that small delays in handling submissions can translate into lost business at scale. ### Where does the $0.35 figure land in the insurance workflow? The $0.35 figure reframes an old insurance complaint as an operating-cost problem. Robben’s wording ties the spending not to paying claims themselves, but to the work required to reach a quote decision and stand behind a future claim payment. Because those outputs are intangible, the number points readers back to the machinery underneath them: intake, triage, document handling, review, pricing and servicing. (iii.org) The National Association of Insurance Commissioners said in its 2025 mid-year property/casualty industry report that underwriting expenses ran at 25.2% of net premiums earned for the first six months of 2025 across the broader P&C sector. That industrywide ratio is not the same metric as Robben’s post, but it shows how much premium is already consumed by expenses before losses are paid, and why workflow costs matter to carriers. (myspace.com) ### Why do quote decisions still take so long? Robben said more than half of the deals an underwriter wants to quote take more than a day to deliver. That matches a wider set of complaints from insurance operators and vendors about submissions arriving as unstructured documents that require manual sorting, rekeying and follow-up. Insurance Business wrote on May 20 that “submission volume is climbing fast - faster than the workflows built to handle it,” citing Feathery executive Zack Khan ahead of InsuranceFest. (content.naic.org) Applied Systems’ Kat Pregelj wrote in February that larger commercial risks can take weeks of back-and-forth among underwriters, assistants, account managers and producers before a submission is ready for rating and pricing. (myspace.com) ### What gets lost when submissions sit in inboxes? Applied Systems said several large carriers report that up to 35% of commercial lines submissions they receive are never reviewed by underwriters. CoverForce wrote in May 2025 that slow submission handling leads to “lost premium,” with producers moving to another market when responses take days and require repeated clarification. Those are vendor and industry-source claims, not regulator data, but they describe the same failure point: business can disappear before a carrier ever makes a pricing decision. (insurancebusinessmag.com) The Insurance Information Institute says commercial lines make up about half of U.S. property/casualty premium. In a market of that size, delays in triage and quote turnaround affect not only expense ratios but also hit rates, broker relationships and the share of submissions that convert into bound business. That link between workflow speed and revenue is the reason vendors have been pushing intake automation and data structuring tools. (insurtech360.com) ### Is this only about carriers cutting costs? The bottleneck is not only a carrier problem. Brokers, wholesalers and insureds all feed the same chain, and each handoff adds friction when data arrives in different forms and systems. CoverForce said wholesalers receive hundreds of submissions a week, many missing key information, while Feathery said underwriters still spend time rekeying data that should already be structured. (iii.org) S&P Global Market Intelligence reported that U.S. property/casualty insurers exceeded $1 trillion in direct premiums written in 2024. That premium growth gives scale to the debate: even modest improvements in quote turnaround, document processing or straight-through handling would affect a very large revenue base. (blog.coverforce.com) ### What happens next? InsuranceFest is scheduled for July in Santa Monica, and Feathery has said it plans to use the event to discuss submission intake and workflow strain with carriers, brokers and MGAs. Robben’s May 23 post did not point to a formal report, so the next test for the $0.35 claim will be whether insurers, brokers or trade groups publish underlying benchmarks that break out how much premium is being consumed by underwriting and service operations. (insurancebusinessmag.com) (spglobal.com)