The vast majority of carriers are prioritizing the use of data and analytic technologies to inform decisions on pricing, according to a new study conducted by Celent and commissioned by Equisoft. The study found that using data for pricing is a priority for 91 percent of insurers surveyed.
Giving customers more of what they want also ranks high, with customer experience, customer service and customer insight each cited as a priority by 73 percent of respondents.
“The volume of data collected by insurers is increasing every second, and deriving value from that data has become a hot topic and one that many carriers are grappling with,” said Mark DePhillips, senior vice president, USA at Equisoft. “Our goal with this study is to provide insurers with practical insights on what their peers are doing with their data today, and help uncover what are the quick wins, how they can actually get value from their data right now.”
Among the other findings:
- There is no area of the insurance business that is untouched by data, the survey found. Respondents cited IT (73 percent), operations (73 percent), claims (64 percent) and sales (64 percent) as most likely to use data to drive business decisions.
- Insurers said they gain the most value from using data to build actuarial pricing models, automate underwriting decisions and assess customer satisfaction.
- What’s holding companies back from digital transformation? While many respondents cited issues such as legacy storage systems and silos or difficulty finding tech talent, the top challenge was culture. Many carriers are willing to maintain the status quo of legacy systems rather than chance losing clients’ data, having it corrupted or suffering business interruption.
Find the full study here.