As Kirstin Marr, head of data solutions at Insurity, explained in the first article in this series, P&C insurers recognize why they must advance their data and analytics capabilities and are now shifting their focus to how exactly. Since the inception of the Insurity Valen Summit six years ago, we’ve had an unwavering commitment to helping insurers become more analytically driven organizations. To that end, we wanted to “get real” in our roundtable session this year and dive deeper into some of the obstacles that might still be hindering insurers from progressing their data analytics strategies.
While many Summit attendees are well along in their data analytics journeys, having implemented solutions like predictive analytics or straight-through processing, they may still struggle in other capacities. To help us gain some context prior to the session, we surveyed attendees. Here are a few of the findings:
- 83% responded that integrating third-party data is an area of improvement
- 95% responded that their underwriters are using between 1 and 5 systems to inform their decisions
- 78% responded that system consolidation and accessibility of information is an area of improvement for their data analytics operations
These survey results, combined with an illuminating roundtable discussion, point toward pervasive challenges that many organizations still grapple with: disparate systems and sources of information, enhanced analytic capabilities, and the ability to easily and rapidly access trusted data (an insurer’s own data or third-party data). Some standout points from the roundtable included:
- “Barriers include a lack of enterprise strategy. Our analytics and data are very siloed, and an enterprise data lake is a top priority.”
- “Making use of in-house information is difficult. Getting your own data in place to work with is hard.”
- “Multiple source systems make things difficult to track.”
- “Getting people to trust the data is an issue. We have to get data trustworthy before actually applying/using analytics.”
- “Transformation is a huge resource challenge (i.e. money and people).”
- “We want to find experts to deliver service so we can focus on insurance.”
These may feel like universal challenges—because they are. They are the whys—why insurers must implement advanced data and analytics capabilities: to improve operational inefficiency, establish enterprise-wide consistency, modernize systems, and increase profitability, among other reasons.
There are a lot of bright and shiny objects as well as competing investment priorities. Wouldn’t it be great if you had the budget and resources to tackle them all? But in the real world, we (solution providers included) have to zero-in on what is going to give us the greatest return for our investment—especially in a time like now, when perhaps the strategic goals and initiatives we all had planned for 2020 have been sidelined or reprioritized.
The COVID crisis presents new challenges and unprecedented disruption to how we conduct business. For P&C insurers, the need for better data and analytics to fuel high-quality decisions is paramount. The U.S. has already been hit hard by severe storms this year, and hurricane and wildfire seasons are looming. Now, more than ever, insurers need to select and price risk with precision to drive down operating expenses. This includes the ability to identify opportunities to shed underperforming risk through underwriting and risk transfer strategies, and improve insured retention and satisfaction with expedient underwriting and claims management.
Now is the time to reach for the low-hanging fruit, or easy wins. Solutions like predictive analytics, especially when combined with third-party data and geospatial analytics that are purpose-built for insurance workflows, can help you trust your data, and gain enterprise consistency and operational efficiencies—while building from a place of success.
As one of our Summit attendees stated, “Data should be your number one competitive differentiator.” If this is one of your whys, together, we can help you devise a plan for how.
Learn more about how Insurity can help you discover the easy wins right now and make data your competitive differentiator.
Hear more from Bret Stone, vice president, head of Insurity SpatialKey, at Connected 2020. Insurity clients: Visit connected.insurity.com to register. If you are not an Insurity client but would like to attend Connected 2020, please contact us at email@example.com.