Cutting quarterly insurance audits from a week to a day

Each quarter, the carrier’s premium and claims operations team checked financial results against the original contract documents. Five people spent a week opening files, matching values to contract terms, and recalculating commissions and fees by hand.

As the business added MGAs and premium, there were more documents to check, and the review needed more people.

The inputs came from many MGAs in different formats: spreadsheets, contracts and binding agreements as PDFs, loss runs, and payment records. The right answer for any row depended on contract terms spread across those documents.

A difference could come from an error by the MGA, an ambiguous contract, incomplete records, or a mistake in an earlier audit. Telling these apart takes an auditor’s judgment.

The software takes in the documents and data, extracts the values each check needs, and compares them with the contract terms. It recalculates commissions and fees, flags each variance, and suggests a likely cause. The reviewer sees the discrepancy, the source records, and the calculation behind it.

It runs on Snowflake in the carrier’s own account, using Snowflake Cortex for document extraction and search. An evaluation and monitoring layer tracks the quality of results as documents and rules change.

Auditors decide whether each discrepancy is an error, which record is right, and what correction to make. Their decisions are recorded and become test cases when contracts or business rules change.

Quarterly auditing and reconciliation fell from five people working for a week to one person working for a day.

The carrier’s team checked outputs by hand: 99 percent met audit requirements, compared with 90 percent under the prior process.