Why insurance enterprises need to be data driven
Conventionally, physical assets like equipment, land and inventory are used to determine the value of an organization. Today, enter the information age and organizations realize that their data is also a critical asset. Armed with data that is timely, data that they can trust, organizations can rapidly uncover new markets, attract and retain valuable customers, eliminate costly operational errors and delays, deliver products faster, and make smarter business decisions. In short, they can consistently outperform their competitors.
However, to achieve these benefits, enterprises must set themselves up to make sure they are managing and using their data in an optimal way. This can be a daunting, if not overwhelming, endeavor. Think about the fact that it can take months or years to get just two applications-for example, the order management system and the billing system-sharing data effectively. Or the business may spend weeks cleaning a data set, only to have it corrupted all over again as new data enters the system.
To overcome these challenges, businesses have to invest in the people, processes, and technology needed to know where the data resides, to understand it, to clean it and keep it clean, and to get it to where it is needed, when and how it is needed. Enterprises that have taken these steps are able to take advantage of their data assets to work faster, better, and smarter, beating the competition. They are data driven.
Need for data integration in insurance
As an insurer, a company gathers and maintains more and more sensitive information about customers and prospects than most companies do.
But this information comes in many different formats and resides in different applications and systems. Information is stored not just in their own systems and applications, but also in those of the distribution channel partners and third-party networks. And with each new policy sold or claim submitted, information is updated constantly.
With the right platform the insurance company can integrate, aggregate, consolidate, and validate all its data-including distribution, underwriting, policy administration, billing, claims, and reporting data-delivering a single, consistent, reliable view of your customers and your business in real time. In short, the insurance company needs this single view to operate efficiently, better manage risk and compliance, and grow revenue.
Why Is It so Hard to Get Real Value from Data
If it were easy, everyone would be using their data to make brilliant decisions and keep business operations running smoothly. But getting value out of data can be hard. Here are some of the common challenges:
- There’s so much data all over the place
- Once you get access to the data, it’s difficult to get it where it’s needed, when it’s needed, in the shape needed
- The data is almost certainly dirty-full of errors, omissions, and inconsistencies
- Data quality is a problem everywhere
- The business needs to be involved
- It’s hard to set and enforce policies for how data is managed
- It’s challenging to prove the business case
What It Means to Be Data Driven
Overcoming these challenges requires commitment. Enterprises have to make investments, and change their culture. But the payoff is worth it. Data-driven enterprises maximize the business value of their data by establishing the organization, processes, and infrastructure necessary to manage their data as a strategic asset, ensuring that relevant, trusted data can be delivered to the business when, where, and how it is needed to support the changing requirements of the business. The following are the components of a "data-driven insurer"
- Business value: Even though data is often considered to be a problem that is handled by IT, the use and value of the data is for the business.
- Organization, processes, and infrastructure: Managing the data effectively requires that the right processes are in place, that the right people with the right skills are on board, and that enterprises have the right supporting technology infrastructure to support those people and processes. The backbone of the technology infrastructure is a data integration platform.
- Relevant: Not every piece of data is important or even useful to the business. It’s important to focus the limited resources on the data that is the most relevant for driving the business. But it takes effort and discipline to determine which data is most relevant.
- Trusted: The business has to be able to trust and have confidence in the data that it is working with. It needs to know where the data came from and that it’s clean and accurate.
- When, where, and how: Different people and applications need the data at different times and in different ways. A customer service rep may need to see a specific customer’s full transaction history when he or she receives a call from that customer. A marketing analyst may need to see all the transactions from all customers for the past three years to find trends and patterns.
- Changing needs: much like in business data needs are also dynamic. Hence it’s not just about meeting a specific business requirement enterprises need to make sure they can continuously meet the data needs of the business as they constantly fluctuate.
The Payoff in being data driven
- With consistent, clean customer data, enterprises can furnish the highest quality of service and support at every point of customer contact to increase retention and share of wallet.
- With accurate data, organizations can eliminate operational errors that can delay or even derail the delivery of products and services to their customers.
- Efficiently produce data for compliance reporting that is correct and accurate, eliminating the risk of penalties due to erroneous or incomplete data. And easily set and consistently enforce policies for how clean data must be, how sensitive data must be protected, or how fresh the data must be to meet regulatory requirements.
In short, Data-driven enterprises are more nimble. They have more efficient, lower-cost business operations. They have more valuable relationships with their customers. They make smarter decisions. And they beat the competition.
How the right platform can solve some of the insurance industry’s most intransigent problems:
Claims Management: By enhancing the quality, integration, and usage of real-time data to decrease loss ratios and improve customer service, the right platform accelerates time to value by supporting limited or no-touch claims processing.
Customer Insights Management: The right platform can help the insurance company achieve a single, comprehensive, reliable view of all customer data by integrating disparate data sources into a wealth of information ready for business intelligence (BI), analytics, reporting, and real-time processing.
Distribution Gateway Management
By simplifying data exchange and data integration, the platform improves complex distribution channels so that the insurance company can accelerate time to market, reduce costs, and grow revenues.
Insurance Agent Gateway: By transforming data from multiple back-office systems into any formats their agents prefer, thereby strengthening agent relationships while lowering risk and significantly improving operational efficiency.
Insurance Broker Gateway: It should allow insurers transform data from multiple back-office systems into any formats their brokers prefer, improving productivity and deepening broker relationships while significantly cutting IT costs.