Insurance Standard for Industrial Classification (ISIC) Qorus Innovation in Insurance Awards 2020

Old Mutual Insure recently launched the Insurance Standard for Industrial Classification (ISIC). The ‘business description’ field is used by binders to capture the economic activity of the customer. It is one of the most critical data in the underwriting, as it allows an insurer to accurately classify the underwriting risk for all the vastly different businesses on its books. Examples include: Growing of avocados, Manufacture of motor vehicles, Retail sale of textiles, Pizzeria, Book publishing, etc. However, there was a lack of uniform data standard for this field in the insurance industry and binders had to use a “free-text” or generic description (i.e. “Retailer”, “Manufacturer”, “Property owner”, etc.) to describe these economic activities. This negatively impacts the insurer’s ability to analyse portfolios and create straight through processes for profitable and sustainable underwriting. ISIC codes are harmonised with the Statistics SA SIC Codes which means that ISIC allows for data integration with external sources. ISIC a giant leap forward for our industry – for the first time, there will be a standardised list of economic activities that the entire industry can use. Old Mutual Insure has made these data codes available to the industry free of charge. ISIC code implementation is supported by Bryte, Santam and Hollard. Almost all third party system providers cater for standard list of Business Categories so ISIC can be easily implemented without any development work. Tial Technologies is going live with ISIC in June 2020. Old Mutual Insure is currently developing POC for straight through underwriting processing of low risk using ISIC codes.