The “big data” buzz that dominates so much of the P/C insurance conversation these days may not be as uniformly useful as everyone thinks. Executive Summary Small to medium-sized insurers are particularly well-primed to adopt data-driven cultures that will allow them to turn big data into better data, according to Mitesh Dasani and Ashish Nangla, senior directors of Synechron. Here they provide tips for intelligent data accumulation.
In the majority of cases, the usefulness of big data hinges on its quality versus its raw quantity, which is why a small to medium-sized P/C carrier can gain a distinct competitive advantage over its larger peers by taking finer, more effective tools to smaller and more accurate data sets. For them, “better data” trumps “big data.”
When used correctly and efficiently, data analytics can be leveraged in product development, by allowing insurers to tap into the wisdom of crowds to address pain points; in pricing and underwriting, by customizing mass-market products like vehicle insurance; in risk control, by using analytics to identify potential loss areas and put strategies in place to avoid them; and in claims management, where effective application of data analytics with a focus on social networks and geospatial information can help insurers reduce claims fraud.