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The value of data-driven insurance


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Author: Monica Epple, Head of Digital & Smart Analytics at SwissRE. Monica is going to participate on Panel discussion V: Global Ecosystem and Big Data trends in Insurance World Challenges data panel on September 23.

The spread of internet-enabled devices has changed consumer behavior and expectations particularly among younger generations. Digitisation has also generated a mixed bag of data from different sources, data which providers of risk protection solutions can use to broaden the reach and boundaries of insurability. Innovative digital cover options for consumers will be the order of the day. The future insurer will need to be acutely aware of customers’ preferences and be able to offer bespoke, real-time service. And artificial intelligence (AI) will play a big part in this.

New insurance sales approach

Insurers will move away from a product-focused sales approach to one closely tied to the broader needs of the customer. New technology will allow insurers to get even closer to customers, meaning they’ll go beyond mere channel management to optimizing interaction across a diverse range of customer touchpoints. This will affect business models, how insurers interact with customers and the nature of their value propositions.

Enhanced underwriting and portfolio risk management techniques

Big Data, combined with sophisticated modelling, will allow risk pricing at increasingly granular levels and help enhance new underwriting and portfolio risk management techniques. Insurers will be able to create early warning systems to help prevent incidents and streamline claims processing. Data-enabled processes will expedite the customer insurance journey, from application to claim.

For insurers, takeaways are manifold:

More fastidious consumers
Consumers are seeking more engaging and personalised purchase experiences. Armed with digitally-facilitated information and greater choice, they’ve become savvier and more self-directed than ever before. In response, insurers need to utilize tools such as AI to improve customer interaction, to gain a better understanding of consumer preferences and to develop customized, flexible product offerings. Insurers should also tap into new sources of data to allow more granular client segmentation.

A free-for-all?
The digital revolution is affecting the whole business ecosystem in which insurers operate. Industry boundaries are becoming blurred as firms in several sectors build digital platforms that can connect to different market places, supply chain hubs and financial networks. Non-insurer participants in business ecosystems are gaining access to customer data, and digital analytics capabilities can enhance their client offering.

A two-pronged approach
Used prudently, new data and technology can strengthen the insurance industry’s relevance for future customers. The same applies to leveraging cross-industry ecosystems. Insurers must continue to embrace both incremental and sometimes more radical innovation to optimize the potential of consumers’ touchpoints.

Helping insurers confront data-associated challenges
The combination of Swiss Re’s internal data sources, its expert industry knowledge, publicly available statistics and insurers data generates powerful insights to help clients best manage their business. Data-driven business insights, together with our dedicated team of experts and strong capital base help our clients grow their business, increase profitability and enhance efficiency.

Big Data combined with sophisticated modelling will allow risk pricing at increasingly granular levels and help enhance new underwriting and portfolio risk management techniques.
To meet business targets, there’s a need for a single, concise view that enables strategic portfolio steering. But aggregating and analyzing vast amounts of data in different formats from different sources is complex and cumbersome. Swiss Re’s Portfolio Insights analytics platform provides clients with intuitive data representation and analytics power. Our dynamic portfolio analysis and outside-in view on performance, customized to specific needs of clients, helps them make the most out of every aspect of their P&C business.

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