Rete Algorithm-based Rule Engine In The Underwriting System

Underwriting is the major risk source in insurance business. Underwriters must be more meticulous, serious, responsible to check and survey the application before policy issuance. And they should preclude the possible insurance fraudulence activities and the insured objects with high risk. But it's very difficult for the underwriters to efficiently check the application and evaluate the risk one by one with operation guideline in paper and by experience when facing tons of quotation application forms. And the manual operation brings about frequent muff and sometimes even terrible result. In the meantime, insurance company should opportunely adjust the risk control level, underwriting business rules and premium rates to meet the latest policy, legislation, market situation and company's own development level. But the original manual underwriting process is very difficult to rapidly respond to these changes and adjustment. So it's very imperative for insurance company to equip with flexible and automatically underwriting business system.The issues in the original underwriting system of ACE Japan General Insurance Company is analyzed. It's confirmed the necessity to use rule engine based on Rete algorithm for business flexibility. And then the business function of underwriting and the major flow including underwriting rule management, rule execution, authority management and business flow under rule control are introduced. The framework of underwriting system, business rule management, rule engine and automatic underwriting sub-systems are also analyzed and designed in detail by modularized method. The emphasis point is about how to use rule engine based on Rete algorithm to implement the underwriting management system for efficient management, system flexibility and standardization. Finally, performance and extendibility of the system are analyzed as well.