About hyperexponential
Founded in 2017, hyperexponential combines actuarial experience and engineering expertise to develop pricing decision software. hyperexponential is specifically focused on commercial and speciality (re)insurance.
Amrit, why did you co-found hyperexponential?
After graduating as a software engineer, I worked as an actuary in the insurance market. I began my career at insurer Catlin (now part of AXA XL) where I got my first taste for creating something from scratch: I built the actuarial function of the Canadian branch. I then specialised as a pricing actuary and worked as the Head of Pricing and Analytics at Tokio Marine Kiln.
I became frustrated with the state of pricing and decision-making software in the commercial and specialty insurance markets, and knew I had the combination of skills to do something about it! This led me to co-found hyperexponential with Michael Johnson, a fellow pricing actuary and software engineer.
You refer to hx Renew as a “pricing decision intelligence” platform – what does this mean?
Decision intelligence brings together data and insights to create a framework for better decision making. I think of data as referring to factual information, whilst insights are more opinion-based and include predictions and beliefs about the world. Insurers typically use both of these in various ways to come to a pricing decision. At hyperexponential, we aim to make this decision-making process as frictionless as possible, and create a tight feedback loop between data, insight and decision that enables our clients to make better decisions over time.
How does hx Renew differ from legacy systems?
Over the last few years, several different platforms have become fundamental to insurance companies’ operations. The first was “systems of record”, which capture data, store it and allow insurance contracts to be administered.
The industry then shifted focus to “systems of information”. These allow users to surface and review information that helps with decision making. Systems of record and systems of information are still important for many insurance companies. These two platforms are usually the key legacy systems that we integrate with at hyperexponential.
hyperexponential differs from these systems as we help with the entire decision-making process – our system is the “system of decision”. For example, spreadsheet automation is just a subset of what we do. hx Renew includes pricing algorithms and all the other parts needed to reach a pricing decision.
How do underwriters and actuaries use hx Renew?
At hyperexponential we view pricing and underwriting as a team sport. With hx Renew, underwriters and actuaries work together to make pricing decisions, and we support them both in different ways.
Actuaries create the in-house pricing models that underwriters use. On the hx Renew platform actuaries can design, build and deploy the models. These are made available to the underwriters in a variety of ways, such as via a webform or API. Actuaries nowadays regularly integrate the decision-making tools they create into the insurance company’s underwriting system to minimise rekeying. In this case, underwriters may not directly interact with the models at all.
Our job is to cater to the varied and ever-evolving workflows of our clients – our goal is to be the most flexible and integrated system in the market.
What underwriting success stories can you share?
One of the examples that stand out for me is Convex – it was one of our first clients. We have helped the insurer build their entire decision-making technology stack, with all of its pricing models in hx Renew. We supported them in building 18 models in under 12 months.
How do IT teams benefit from switching to Renew?
One of the key principles that guided our build of hx Renew was to empower our end users – this applies to IT teams as well. Through our SaaS approach, we remove dependencies and enable actuaries to self-serve their model build, deployment and change capabilities.
This allows IT teams to move away from manual administrative work and spend more time helping their business to use technology to solve business problems.
hx Renew also automates manual activities such as database backups and redundancy. This allows IT teams to spend more time managing data flows and data connectivity into their own technology stack to drive value.
What is hx Connect?
hx Connect is an initiative where we partner with a variety of data and tool providers to build a decision-making ecosystem. We created hx Connect to minimise the overhead required for our clients to integrate a range of new data sources and capabilities.
We spend time with data and technology companies to understand how their systems work and to create pre-built integrations and code snippets. This means that companies who use hx Renew have the ability to quickly plug into alternative data sources, algorithms and technology platforms.
What do you think the industry’s approach to ecosystems will look like in the next few years?
The industry has spent the last few years changing its mindset and doing the pre-work for converting to a much more ecosystem orientated approach. It takes time for any large industry to make a change like this, but we are starting to see the action follow through.
At hyperexponential we have launched partnership initiatives with Cytora and Supercede, and we are already working on other partnerships with established insurance technology vendors. I think in the coming years the whole industry will be seeing a lot more partnerships.
What do you think the future of artificial intelligence (AI) means for insurance pricing?
AI can do a lot of things, but it cannot predict the lottery. By definition, for an event to be insurable it needs to be random. AI will help human beings become more efficient in their day-to-day tasks, but I do not see it replacing entire pricing systems and algorithms. This is because judgements over the meaning of the data are a huge part of the value proposition offered by insurers at the frontier of risk. This is more obvious in the specialty lines, but it is also true in more conventional areas.
What type of companies are you looking to connect with?
First of all, we would like to connect with any company within the decision intelligence space. hyperexponential works with everyone from legacy players to start-up data providers. Secondly, we would love to connect with insurers or MGAs interested in improving their pricing process. To learn more, readers can contact me on LinkedIn.
Why does hyperexponential support InsTech as a corporate member?
At hyperexponential we are big believers in ecosystems and the power of networking. Insurance is a particularly relationship-driven industry, so making connections is a very important part of it. InsTech fosters a great innovative community which helps us to make these connections.