This is the sixth in a series of articles by Valen Analytics looking at the hurdles that insurers must overcome to effectively implement and gain value from data analytics programs.
Executive Summary
Third-party data providers are abundant, but how do you decide which ones merit investments of money and resources? Here, Kirstin Marr of Valen Analytics identifies two types of external data—transactional and behavioral—as she gives advice to answer the question and outlines an approach for combining internal and external data sources with synthetic variables for better predictive horsepower.Making better decisions at a quicker pace is a sought-after advantage in today’s hyper-competitive P/C market. Insurers that have historically relied on their in-house data and manual processes to assess risk are beginning to discover the value of third-party behavioral and transactional data sources.
There is no shortage of third-party data providers, but determining the sources in which to invest, what questions to ask during data collection and what approach combines various data sources for the best market predictors will determine success in today’s competitive landscape.
