Beyond Excel: Building the Infrastructure for Modern Commercial Pricing

Excel remains one of the most widely used tools in insurance pricing, and for good reason.

It supports calculations, rules and formulas, data and assumptions management, scenario analysis, basic modelling and reporting. It remains a valuable and highly effective tool for individual analyses, model development and day-to-day actuarial work.

However, the challenge arises when spreadsheets become the foundation for a wider pricing process involving products, teams and portfolios.

As pricing operations grow, the challenge often lies not in the calculation itself. It is keeping everything around the calculation under control.

Consider a familiar situation. A pricing team downloads an Excel file from SharePoint or a shared drive and starts working on it locally. A few changes are made, and the file is saved as a new version.

If you have ever done this, you are probably not alone. Perhaps the files become v1, v2, v3 and so on, eventually reaching v13. At some point, it becomes difficult to remember which version contains the latest assumptions, which one was used for a particular analysis, or what has changed between two versions.

In a commercial pricing environment, it can be more than just inconvenient.

Different pricing teams may work with different local versions. Underwriters may not know which pricing logic is currently applicable. The actuarial team may update a model, but this may not yet be reflected in the environment used to quote business. Portfolio simulations may rely on macros and locally maintained calculations that are difficult for others to reproduce.

Therefore the issue is not that Excel cannot perform the calculation. Rather, the wider pricing process needs to be more controlled.

This is where capabilities such as:

• a single source of truth for pricing logic
• controlled versioning and model changes
• transparent governance and auditability
• consistent pricing logic across products and teams
• repeatable testing and validation
• portfolio and scenario analysis
• controlled deployment of pricing changes
• integration with underwriting and policy systems
• structured data capture and ingestion

start to become increasingly important.

The question of whether Excel should be replaced is no longer relevant. The question is whether the current pricing environment provides teams with the necessary control and connectivity.

A pricing engine provides a dedicated environment for managing and executing pricing logic. For commercial lines, it can help to bring together pricing models, rules, assumptions and versions in one controlled environment, while providing a more direct path from pricing change to deployment.

It can also connect pricing more closely with the underwriting process. For example, a solution could retrieve information from a PAS or underwriting platform, enabling an underwriter to review or adjust a quote, apply the relevant pricing logic and return the result. External data can be incorporated into the process, while pricing outcomes can be captured for future analysis and model development.

The objective is not simply to calculate a premium. It is to make pricing logic, data and decisions work together as part of the underwriting process.

For commercial lines, the focus does not necessarily need to be on the most advanced modelling capabilities. More practical capabilities can make a significant difference:

• Model management and version control – clear ownership and visibility of the current pricing logic.
• Model import – the ability to operationalise models developed in external tools.
• Underwriter interaction – a quote calculator or UI that allows pricing to be used directly within the underwriting workflow.
• Data and integration – structured data ingestion and connectivity with PAS, underwriting platforms and external data providers.
• Testing, auditing and reporting – controlled releases and transparency over what changed, when and why.
• Portfolio and scenario analysis – supporting simulations without relying entirely on complex spreadsheet macros.

The right solution is therefore not necessarily the one with the most features. It is the one that aligns with the way pricing and underwriting actually operate.

Moving beyond Excel does not mean removing it from the pricing toolkit.

It will continue to play a role in analysis, modelling and day-to-day pricing work. The question is whether the wider pricing environment can support the way commercial insurers need to work as their pricing operations grow.

When pricing logic is spread across local files, deployment depends on IT availability, data has to be moved manually and underwriters are unsure which version is current. At this point the limitation is no longer the calculation itself. It is the infrastructure around pricing.

A pricing engine can provide the missing link by offering a controlled source of pricing logic, a clearer path from model change to deployment, a stronger connection with underwriting and policy systems, and a structured approach to capturing and utilising pricing data.

Moving beyond Excel is not about replacing a familiar tool. It’s about providing pricing teams with the right environment in which to maintain the flexibility of Excel where it adds value, while introducing control, connectivity and consistency to areas of pricing that require it.