COVID-19 has Been a Shot in the Arm for Insurance Industry Data and Analytics
John Hershberger, Financial Services Practice Leader at Wavicle Data Solutions, outlines how the pandemic has accelerated data, analytics and digital transformation projects across the insurance sector
This has certainly been a challenging year in the insurance industry. Wildfires, floods, hurricanes, tornados and, of course, COVID-19 have buffeted the sector over the past 12 months.
Some of the major property claims events, while significant, were dealt with by insurance carriers in a highly effective manner and within the industry’s norms. But the pandemic has represented a very different situation.
For extended periods of time, Americans sheltered at and began to work from home. This unprecedented situation had a large and material impact on property and casualty (P&C) insurance companies.
With Americans driving far fewer miles, auto insurance claims declined materially, and many insurers were able to return significant premium dollars to their customers. Many that did so were able to act quickly as a result of having timely, accurate data. In discussions with our clients, analysis of claims data was regularly cited as providing the facts necessary for insurers to act quickly and in their customers’ best interests.
The insurance industry has been historically slow to adopt innovations. But many leaders in the industry are recognizing that COVID-19 is a strategic inflection point
John Hershberger, Financial Services Practice Leader, Wavicle Data Solutions
COVID-19 also changed the way many customers interact with their insurers. With lockdowns, customers interacted with their insurers more frequently online, further driving the adoption of data-driven services. Our clients report that migration to digital channels has rapidly accelerated. More digital interactions are generating vast volumes of new data, requiring new processing, ingestion and storage capabilities.
Customer expectations for insurers are also increasing. Customers want companies to remember them, how they’ve interacted in the past and what outcomes those interactions led to. As a result, our clients report rising demand for advanced data and analytics processes to create better customer experiences that mimic their experiences with the big tech companies.
The Time to Invest in Data and Analytics is Now
In these unprecedented times for insurers, the companies that best adjust their business models to meet rising customer expectations have the greatest opportunities to win in the marketplace. However, many of our clients lack the staffing or the experience to build state-of-the-art data and analytics capabilities required for this future.
Successful data and analytics projects require focus and direction, adequate resourcing and, most importantly, experienced development resources. Efforts of this nature also require insurers to think differently about how projects get done and the speed-to-market requirements to be successful.
Many of our clients report major challenges rapidly delivering successful data and analytics initiatives, highlighting the need to find the most skilled resources to take on these major projects.
The insurance industry has been historically slow to adopt innovations. But many leaders in the industry are recognizing that COVID-19 is a strategic inflection point for data and analytics in their companies.
There are now more insurers initiating more data and analytics projects to meet rising customer needs and expectations. Wavicle has observed this shift and hopes to work with many more insurers in the future as they embark on the road to data maturity.
This is an extract from Corinium's Future of Insurance Data 2021 report. Claim your copy here today to discover more about how insurance sector data leaders are safeguarding business continuity, transforming business processes and improving customer experiences in the age of COVID-19.
