Insurers that are able to make the best use of data are already winning market share, improving key ratios and generating superior risk intelligence, according to a report from the Capgemini Research Institute. These organizations are considered data masters.
“Only 18% of insurance organizations have both the technical capabilities, as well as culture and behaviors to support
The report,
Almost all of these data masters have reported improved combined ratio and stronger net promoter scores compared to about half of other insurance organizations. These organizations typically showcase three differences, 92% have a centralized governance or facilitation body, 62% collaborate with
“It has become increasingly difficult for traditional insurers to compete with insurtech companies,” said Seth Rachlin, global insurance industry leader at Capgemini, in a statement. “These organizations can only compete by embracing a data-driven approach to win market share, improve key ratios, and generate superior risk intelligence.”
Insurance organizations use data to develop new solutions, create value-added services to engage customers and enable unique insights into
Only 40% of insurers are using data to enter new markets and 43% have modernized and upgraded their
The report suggests four areas for insurance companies to invest in:
- Build infrastructure to allow rapid implementation of data-derived insights including a modern technology platform and provide data in a timely manner.
- Establish appropriate operating models to scale data-driven insurance use cases.
- Foster a strong data culture across the organization by adopting and encouraging employees to use data.
- Orchestrate an open-data ecosystem and consider collaborating with insurtechs.