Unlocking the value of externalized rating in the U.S. insurance market

The challenge

In today’s rapidly evolving insurance landscape, staying competitive requires the ability to update rates, rules, and analytics swiftly and accurately. However, many U.S. insurers still rely on rating engines embedded within policy administration systems (PAS)—tools that often slow time-to-market, introduce production errors, and limit the sophistication of rating strategies due to system constraints and IT bottlenecks.

What is externalized rating?

Externalized rating refers to the practice of moving the rating function out of the core PAS and into a dedicated, standalone platform. This approach empowers business users to manage the full end-to-end rating process without heavy reliance on IT.

Melissa Bagley, a P&C Actuarial Director at WTW, explains:

“While externalized rating has been widely adopted across global insurance markets for over a decade, U.S. insurers have only recently begun to embrace this more agile and business-led model. And it’s exactly the shift they need to make.”

The path forward

For insurers looking to remain competitive and agile, adopting an externalized rating platform is no longer optional—it’s essential. A true end-to-end solution enables seamless integration across pricing, decision-making, filing, and deployment, providing the agility needed to respond to market trends with speed and precision.

To unlock agility and meaningful business value, externalized rating is the next step forward.

Used by over 500 of the world’s insurers, WTW’s Radar is the market-leading SaaS-enabled, end-to-end analytics and deployment solution that allows insurers to externalize rating and underwriting rules. Built by insurance experts, for insurance experts, Radar offers unmatched analytical speed, enhanced transparency and governance, and leading-edge innovation in pricing and rating.