Insurers are losing millions because outdated systems make rate updates slow and costly. By decoupling pricing logic from legacy policy administration systems, companies can deploy new rates in hours, rollback changes instantly, and reduce premium leakage, according to Akur8.
In a market where inflation and shifting risk profiles can turn a profitable rate into a loss within months, speed has become a critical competitive advantage.
The cost of slow rate updates
For many carriers, rate changes remain locked inside monolithic systems, requiring months of IT coordination to implement even minor adjustments. This delay translates directly into lost revenue.
A carrier with a $100m gross written premium (GWP) book needing a 5% rate increase could forfeit $2.5m simply because updates take six months to roll out.
During this lag, competitors can target the most profitable policies, leaving insurers with higher-risk, underpriced portfolios. In North America, where policies are often annual, slow updates can lock insurers into lower premiums for over a year, further compounding financial losses.
Decoupling as a strategic solution
Externalised rating engines and decoupled rate control layers offer a faster, more agile approach. By moving pricing logic out of the core PAS, insurers empower business users to manage rates directly through low-code or no-code interfaces.
Rate changes can be deployed in hours rather than months, and if a strategy underperforms, it can be rolled back instantly without waiting for emergency IT patches. This agility reduces leakage, mitigates adverse selection, and improves loss ratios. Modern engines have been shown to improve loss ratios by up to 2.8%, making speed not just an operational benefit but a key driver of profitability.
Reclaiming competitiveness through agility
Treating rate changes as lengthy IT projects is no longer sustainable. In an environment of economic volatility and social inflation, insurers that can move faster than their competitors gain a measurable advantage.
By giving business teams control over rate deployment independently of legacy PAS cycles, carriers can stop financial bleeding, respond to market shifts instantly, and turn pricing from a bottleneck into a strategic asset, according to Akur8.
Read the full blog from Akur8 here.
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