How Insurance Policy Administration Works

What are Insurance Policy Administration Systems (PAS)?

As consumers demand immediate access to information, products, and services, the Policy Administration Systems (PAS) of modern carriers are essential to the continued success of the companies they support. In today’s world, technology “touches” the daily lives of insureds and agents even more than people do, and therefore is the dominant player in customer service.

Key Functions of PAS:

• Policy Management: Handle point-of-service for new business, endorsements, renewals, cancellations, and reinstatements.     
• Rating: Automate premium calculations.
• Billing and Payments: Streamline invoice delivery and payment processing.
• Claims: Facilitate claims processing and reporting.
• Data Analytics: Leverage predictive analytics for risk assessment and real-time decision-making.

The Current State of Policy Administration Software

Policy Administration Systems (PAS) have evolved dramatically over time. Initially, a PAS was just a “posting” system—able to record a transaction after it had occurred but doing little before that time. Only when a quote was bound did the PAS recognize the transaction.

Early PAS applications could process most policy transactions, including new business, endorsements, cancellations, and reinstatements, but provided limited pre-sales support.

The advent of the Internet changed this dramatically, enabling agents to access live policy and financial data, verify coverage amounts, and download proof of insurance. This shift improved customer service and reduced administrative burdens on carriers.

As technology evolved, so did PAS functionality and user expectations of what should be available with “just a few clicks.”  Carriers soon gave agents access to live rating, enabling them to key application data directly into the system of record and provide an accurate and bindable quote. Carriers benefited from getting agents to do this clerical work for them.

Thus, with the advancement of technology, PAS applications soon became essential to the sales process, including automated rating, underwriting, information gathering, and down payment processing.

How Did Data Analysis Change Policy Administration Software      

The property and casualty insurance software market was expected to grow by 11.5% in 2024, reaching over $21 billion in 2025. This growth was driven by the increasing demand for advanced PAS that integrate with external data sources, leverage AI, and provide 24/7 self-service capabilities.

Today, PAS connect with external data sources and third-party data for rating, underwriting, banking, and compliance. More and more insurers have adopted predictive analytics to evaluate risk based on historical claims, policyholder behavior, and other external data (e.g., weather patterns and crime rates), using Artificial Intelligence to enhance underwriting accuracy, claims handling, and fraud detection. This digital transformation allows PAS to streamline insurance operations via faster policy processing and administration. 

Modern PAS Features:

• Real-Time Data Access: Agents and insureds can now buy, pay for, endorse, and renew policies any time, on any day.
• Predictive Analytics: Carriers now evaluate risk using historical claims, policyholder behavior, and external data (e.g., weather patterns, crime rates).
• AI and Automation: Enhance underwriting accuracy, detect fraud, and streamline claims processing.

Challenges to Policy Management Systems

PAS are inherently complex, reflecting the underlying regulatory challenges, product features, integrations, and customizations necessary for carriers to differentiate themselves and compete successfully.  

 At SpeedBuilder Systems, our decades of experience working successfully with carriers and large MGAs have enabled us to not only advise and support clients wherever they are in their IT journey, but also to prevent many of the pitfalls that the industry often encounters.

Common Challenges and How SpeedBuilder Systems Addresses Them:

1. Difficulty Migrating Outdated Technology

Legacy systems can be costly and disruptive to replace. 

Many insurers still use legacy PAS platforms that are difficult to replace. Migration is costly in both time and money, often leading to operational disruptions and data loss risks. Many large software vendors quote high costs and multi-year implementation timelines, discouraging carriers from upgrading.

Solution
✔ SpeedBuilder Systems has successfully replaced legacy systems, both in whole and in part. It also provides seamless integration with 24/7 customer service.
✔ BindExpress offers enterprise-grade capabilities without the massive costs and work required for implementing and maintaining other blue-chip platforms.

2. Lack of Flexibility in Affordable Solutions

Many PAS systems lack the ability to economically customize unique workflows, robust underwriting, or specialty product lines. 

Property & Casualty carriers require highly customizable software that can adapt to different product lines, underwriting rules, and reporting needs. Many of the largest PAS vendors have platforms that require costly modifications to meet these requirements.

Solution
✔ BindExpress is a comprehensive, end-to-end policy management system with over 4,000 configuration settings, empowering business users to adapt everything from quoting and underwriting to claims and billing—all within a single platform. 

✔ Due to its SaaS-based foundation, BindExpress offers a flexible pricing scale, ensuring you only pay for what you use. 

The goal of SpeedBuilder Systems is to develop tools and technologies that empower business users – including clients – to control as much of the PAS as possible.  

The SBS COmputational and Rules Engine (“SCORE”) empowers product managers, actuaries, and business analysts to develop, test and deploy all rating in a user-friendly, yet robust, workbench.  

✔ To best illustrate, at SBS, our Business Analysists perform all of the rating and rules work we do when implementing a new client – not our Developers
✔ We can then train clients to perform this work themselves

With the BindExpress FormMaker tool, business users can create their own templates using industry-standard tools like MS Word, map policy-specific data into those forms, and save the templates for use with future policies.

3. Poorly Designed Interfaces 

Legacy systems often have cluttered interfaces that frustrate users.

Legacy systems often have outdated and disorganized user interfaces that are difficult for agents and policyholders to navigate. Modern consumers expect seamless, digital-first self-service tools.

Solution
✔ BindExpress was designed to focus on the user experience, implementing intuitive navigation, transparent workflows, and minimal data fields to reduce complexity.

4. Integration with Third-Party Systems

Seamless integration with other data services and systems is critical but challenging.

Most legacy PAS systems lack API connectivity to essential third-party services, including credit history, claims processing, and payment gateways. With the rise of Artificial Intelligence (AI) and machine learning, insurers need seamless data integrations to remain competitive. 

When considering changing policy administration systems, one reasonable question is, “What is it that I don’t know that I don’t know?” This is a legitimate concern of carriers regarding the PAS they are betting their future on as well as the vendor behind it.

Solution

✔ BindExpress offers a comprehensive API suite in multiple formats (XML, JSON, CSV) that enables:

• Full policy data extraction based on policy or claim numbers.
• Automated policy transactions (binding, endorsing, canceling, reinstating, etc.).
• Daily transaction exports for compliance & audit purposes.

Another Competitive Advantage: AlwaysCurrent Architecture™

In today’s rapidly evolving tech landscape, many insurers fear investing in PAS systems that become obsolete within a few years. Additionally, most vendors require costly custom code retrofitting when rolling out updates, which many carriers avoid.  The result: they stay on older, outdated versions of their PAS.

Solution
✔ The AlwaysCurrent Architecture™ of BindExpress ensures insurers stay updated without needing major retrofitting or redevelopment.
✔ All product enhancements and security updates can be deployed seamlessly, keeping insurers as current as their last software build.

✔Cloud-Native Security: BX ensures high availability and data protection with advanced encryption and regular security updates.