May 23

Federation Frees Agents/Carriers From Password Jungle

By Insurance-Canada.ca BlogEditorNo Comments

If there is one consistent complaint among active Internet users, it is the requirement for multiple sign-ons and passwords for different sites. A group of independent agents, agency management system vendors, and  insurance carriers in the US has come up with a solution that simplifies connectivity within their  community.

The concept is referred to as ‘ID Federation’.  Essentially, it is a set of  standards and agreements that allow a single sign-on which will be ‘federated’ among a group of organizations.  When a user signs-on, his/her credentials will be passed to other organizations where she/he has rights.

The concept is simple, but the security and legal requirements are not.  To take this on, a group of pioneering organizations set up a not-for-profit company, ID Federation, Inc. which would steer the processes.   These first movers consist of three insurers (Hanover, Progressive, The Hartford), two agency system vendors (Vertafore and  Applied Systems), and two independent Agencies ( BB&T Insurance Services, and Slocum Insurance Agency).

At this week’s ACORD/LOMA Insurance Systems Forum, the organization announced that the technical and legal challenges have been addressed sufficiently to allow the organization  to accept applications for additional participants to help take the concept ot reality.

To date, testing has gone well and BB&T have been using the approach with The Hartford.  Grey Nester of BB&T said that this has significantly improved workflow within his offices.  Jim Rogers, from The Hartford, echoed this sentiment.  ”We eliminated support call issues from a identification perspective,” Rogers said.

While the activities are now limited to the agency -company connection, the same principles can allow consumers connect to an agency  and through the agency’s  systems to other Federation members (into the company’s system to  check claims or billing status, for instance).

There is more development work required and the ID Federation has set up four working groups to get input from a wider group of participants on additional legal, use case, technical and management issues.

Additional details can be found on the the ID Federation’s website.  At this point, the ID Federation is restricting its work to the US, but agrees that expanding internationally would be desirable in the longer term.

 

Broker-Carrier Relationships, Broker=Carrier Connectivity, Security
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May 20

A Millennial’s Views On Her First ACORD Conference

By Amanda Rogers Student Nazareth CollegeNo Comments

Editor’s Note:  Amanda is studying Business and Finance.  She attended the recent ACORD/LOMA Insurance Systems Forum and accepted our invitation to share her impressions.

I stared the conference off by listening in on a panel discussion about Agent Council for Technology (ACT). I found it a perfect way to start off because it introduced everyone into what ACT really is and how companies have incorporated it. I think that ACT serves as the catalyst to generating ideas to progress the insurance industry. It connects vendors, carriers and agents so that they can discuss what the industry is doing right and what things they are behind the ball in.

One topic that was greatly discussed over the entire conference was the under utilization of social media. I attended a break out session that brought up this topic and I left the room frankly feeling very frustrated. When we all reconvened in the original meeting room we were asked if there were any take always or “aha moments”. So I took to the microphone and was able to voice my opinion then. I questioned why there seemed to be this fear of social media. It was brought up that some companies have hired people of my generation to run social media within their organizations. Now I am all for helping out but I do not think an entire industry needs its hand held trying to work through this problem. It’s like learning anything new. At first it can be intimidating, then you get your foot through the door, you start to learn, there are bumps along the way but in the end you have gained experience, knowledge and now have a new tool at your disposal. However, if fear stops you from taking a first step, it is no wonder why a delay is the outcome of that hesitancy. Now I realize this is all easier said than done.

My suggestion on how to get started is to go ahead and hire a person to coordinate social media for your company but not before every employee knows how to use, and can teach what media your company plans on using. It seems that the majority of people in this industry know how to use an agency management system. How employees had to learn this system is how learning social media should be approached. Also, because of this delay there seems to be a disconnect between my generation and the “classic professional”.   If the industry wants to know how to reach me as a target market all you have to do is ask (preferably via sites like Facebook and Twitter).  If social media still scares you then ask local college students to come to a conference like the ACORD conference or maybe even talk to DECA which is an organization that deals specifically with business oriented high school students. Reaching out will not only expand your company name but will get people in my situation to gain knowledge on the industry.

One other take away I got from this conference was the presentation Ian Ayres gave on data analytics. I do not agree with everything that he talked about like saying kids have lower test scores just based on the quality of the teacher. There are so many other factors to take into consideration. But, that is the beauty of data analysis it is used to give us the best guess at the outcome of a certain event. It combines math and economics to pin point emerging trends and plans of action. I feel that this way of thinking is going to become more prevalent. It is the closest thing we have to a crystal ball that can see into the future. I feel like it is something that I myself and every business student should seriously learn more about.

Overall, I had a fantastic time at the conference and while I did have a few people say to me that I would not like the boring insurance world, I actually found it engaging. I feel like I have just scratched the surface and would like to thank everyone I met for their generosity and their probing questions that left me wanting to know more.

 

Postscript:  Amanda says she is interested in coming back to the ISF in spite of the disparaging remarks from other attendees about our “boring insurance world.”  And “classic” is a term developed in an ACT working group for agents over a certain age. Ed.

Analytics, Social Media
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May 17

Forget Forests, Give Up On Gas, Dump Diamonds: Here’s The Real Natural Resource

By Insurance-Canada.ca BlogEditorNo Comments

If there’s one consistent message coming from this week’s ACORD/LOMA Insurance Systems Forum, it might be this:  “Put your head in the cloud, and dig deep for data.”

Keynote speaker, Vivek Kundra, former CIO of the US Government and soon to be EVP Developing Markets, Salesforce.com, discussed the challenges he faced and the opportunities he exploited while at the White House. Significant among these were the containment of data centres and opening of massive amounts of information in the Open Government initiative.  (We blogged on key elements of this recently.)  Kundra noted that there are now 400,000  open data sets which are acting as springboards for new, privately developed, information sources which are stimulating economic activity.

That was the starting point. Over the next two days, an attendee would have to carefully plan to avoid  a breakout session, panel, or hallway discussion that didn’t have some reference to data and analytics.  These ranged from executive level BI dashboards, to operational data stores,  to cloud based big data and applications.  The following is but a sample.

While heavily targeting the insurance carrier community, agents were not exempt.  During the ACT meeting preceding the conference, Josh Lee, from MicroStrategy, a BI  Consulting firm, provided information on “How new business intelligence tools are transforming businesses”.  This was followed by an update on he first phase of ACT’s Business Intelligence “Think Tank” project, which is intended “to explore ways in which the Independent Agency distribution system could take better advantage of the opportunities that are available to use business intelligence tools to make smarter, more targeted decisions…” (source: ACT Business Intelligence “Think Tank” Phase One Interim Report.)

The next step in this project is very operational, “to identify and share: (1) what are the key business indicators of success for independent agencies, as well as (2) what are the types of information company marketing reps want to know about their agencies, so that we make sure agencies can easily generate this information from their systems.”

A good summary of the current state of, and future opportunities for insurance came in an IBM presentation – Transforming Business with Analytics and Expert Integrated Systems -  by Neil Isford and Rick Hoehne (both alumni of previous Insurance-Canada Technology Conferences).    The concept of the session  was that data was the next natural resource.  Data are being mined now by straightforward means, but will become more valuable as increasingly powerful techniques are used for extracting and exploiting the resource. This will create a transformation from descriptive uses, to predictive uses, and beyond to prescriptive uses.

Insurers are taking new approaches to making data operational.  Elizabeth Riczko, Group Analytics Leader for Ohio based Westfield Group, described how she created a new unit which helped the organization rationalize data (to create a “single version of the truth”) and move to support operating units as they learn to take advantage of an increasingly rich source of corporate data.  This began with agency focus, but is now moving to operational support for a new group of empowered users within the different business units, utilizing multiple data sources.  Riczko advises that one of the most critical functions is to maintain discipline on the data through effective governance.  “It is not glamorous, but failure to enforce this is high risk,” Riczko says.

In other words, the data asset is not only an important resource, it is valuable, and should be protected.  One nice part, if cared for, no matter how much it is consumed, it is completely renewable.

 

 

 

Analytics, Big Data, Business Intelligence, Consumer Insight and Action
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May 14

What’s Big: Government, Data, Cloud, Opportunity, Money

By Insurance-Canada.ca BlogEditorNo Comments

Turns out there’s a big cloud forming over Washington, DC.  And it could change forecasts in many places.

In a March 29, 2012 release, the White House announced the  “Big Data Research and Development Initiative.”  The intent is ambitious: to improve “our ability to extract knowledge and insights from large and complex collections of digital data, the initiative promises to help solve some the Nation’s most pressing challenges.”

There will be a US$200 billion commitment from six US federal agencies (aligned with some specific initiatives): The National Institute of Health (1000 Genome on a cloud  project), The Department of Defense (automated decision making), the National Science Foundation (data analytics, visualization, distribution), Defense Advanced Research Projects Agency (new analytic tools and techniques for imperfect data),  the Department of Energy (coordinating university access to analytic and visualization tools for large data sets), and the US Geological Survey (grants for projects using advanced tools to  “improve our understanding of issues such as species response to climate change, earthquake recurrence rates, and the next generation of ecological indicators”).

Commenting on the announcement, Reuven Cohen, writing in Forbes, said  “One of the more interesting aspects of this project is the use of public cloud infrastructure, as in cloud computing services provided by the private industry.”  Cohen says the NIH project is an example: “the current 1000 Genomes Project data set is a prime example of big data, where  data sets become so massive that few researchers have the computing power to make  best use of them. AWS is storing the 1000 Genomes Project as a publicly available  data set for free and researchers only will pay for the computing services that they use.”  The NIH is using the Amazon Web Services (AWS) cloud.

Cohen notes that this initiative may be related to “a larger strategy to reduce the number of federal data centers from the current  3,133 data centers sliced by ‘at least 1,200′ by 2015, representing a roughly 40% cutback at a $5 billion savings.”

The initiative is also related to the White House’ Cloud First Policy, authored by Vivek Kundra U.S. Chief Information Officer, which promotes use of private sector innovations in the government.  The  Strategy says: “Cloud computing offers the government an opportunity to be more efficient, agile, and innovative through more effective use of IT investments, and by applying innovations developed in the private sector. If an agency wants to launch a new innovative program, it can quickly do so by leveraging cloud infrastructure without having to acquire significant hardware, lowering both time and cost barriers to deployment.”

This is a big, and ambitious project.  In making the announcement, Dr. John P. Holdren, Assistant to the President and Director of the White House Office of Science and Technology Policy, said: “In the same way that past Federal investments in information-technology R&D led to dramatic advances in supercomputing and the creation of the Internet, the initiative we are launching today promises to transform our ability to use Big Data for scientific discovery, environmental and biomedical research, education, and national security.”

As big as the Internet, eh?  Well time will tell.  At least he didn’t get too excited and compare it to the Facebook IPO.

Analytics, Big Data
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May 13

What is Driving Auto Insurance Down? And Can Smart Technology Drive It Up?

By Insurance-Canada.ca BlogEditorNo Comments

Those of us who have been involved in automobile insurance, including the machinations of market swings and government interventions,  might have quietly bemoaned the hoops we have had to go through to write this business.  However, none of us (in our sober moments at least) have wished for the a significant cut in the size of the automobile insurance market.  Nevertheless, a recent report and an examination of some related data suggest just such a scenario might be at play.  And, while technology might be one of the the prime drivers (pun intended) of the trend, in service to great irony, it seems that technology will be required to monitor and profitably manage the impact of the trend in any event.

In a recently published report, Donald Light, Senior Analyst in Celent’s Insurance Practice, constructs a scenario in which the use of three currently available technologies (telematics, collision avoidance, automated traffic law enforcement) and one emerging technology (robot cars - like the one recently licensed in Nevada) cause a substantial reduction in traffic accidents and insured automobile losses. As a result, property/casualty insurers could see a major reduction in their auto insurance premiums revenue.

According to the analysis, the result could be a decrease in the auto insurance portion of total (US) P/C premium from 39 percent to just 13 percent.  However, Light’s analysis suggests that these elements will play out over the next decade, if the scenario actually plays out at all.

But, before we become too comfortable, there are data that suggest that other factors, independent of those in the Celent analysis, could be accelerating a trend towards lower automobile insurance revenue.

Growth in the North American automobile industry is slowing, especially in comparison to Asia and Latin America.  According to the recent Scotiabank Global Auto Report, Asia car sales grew by 38.0% in the period 2009 – 2012, while North American sales grew by 31.8%.

The situation gets worse when we look at where the softness lies.  For some time now, commentators in Canada and the US have been noting a waning of interest on the part of Gen Y for personal automobiles. MSNBC.com’s Alison Linn, writing about the US experience in early 2010, said: “A confluence of events — environmental worries, a preference for gadgets over wheels and the years long economic doldrums — is pushing some teens and twentysomethings to opt out of what has traditionally been considered an American rite of passage: Owning a car.”

Linn goes on to note, “The percentage of new cars sold to 21- to 34-year-olds hit a high of nearly 38 percent in 1985 but stands at around 27 percent today, according to CNW research.”  Worse still, some other leading indicators are moving lower as well: “In 2008, 82 percent of 20- to 24-year-olds had their driver’s license, according to the Federal Highway Administration. Although that’s gone up a tiny bit in the past few years, it’s down from more than 87 percent in 1994.”

Urbanization is also putting pressure on individual car ownership.  There is a clear trend for Gen Y to elect to live in downtown areas, frequently sacrificing car ownership for the privilege.  Famously, at least one new condo construction in Toronto features space for bicycles, and a car share facility, but no individual parking spots on the premises.

So what shall we do to prepare for this trend? There are a number of complex, interdependent factors that will be impacting the results for insurers.  The loss of younger drivers, and the reduction in claims frequency and severity of auto claims does not mean all insurers’ revenues will be negatively impacted.

Light’s suggestion is to use technology to understand and potentially profit from developments as they occur: “In the near term, an auto insurer should be asking itself three questions,” he says.  “First, how is it monitoring technology-driven changes in insured losses, (i.e., the progress of the scenario)? Second, do scenario technologies provide new kinds of data and analytics-driven changes in pricing, underwriting, etc.? And third, what should it do differently this year and next?”

In other words, it might be time to work smarter by putting our analytic pedal to the metal.  Hope your vehicle is equipped with that feature.

Analytics, Telematics
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May 07

Free Trade in Broker Connectivity: ACT in Action; ORBiT Increasing Altitude

By Insurance-Canada.ca BlogEditor2 Comments

Independent insurance agents in the US have issued a report on progress towards achieving goals in broker connectivity.  At the same time, Canadian brokers are consolidating around actions to promote their interests in connectivity.  Are these groups aligned to benefit both groups and exert maximum leverage going forward?

The ACT committee of the Independent Insurance Agents and Brokers of America (IIABA) recently completed a survey of  3,700 independent agents and brokers around issues with insurance carrier communications.  The resulting report indicates  that the vast majority – 90% – of respondents were conducting ‘download’ (carrier transmission of policy and other information to the agency) and finding savings.  In personal lines, 53% indicated savings of 1 hour or more per day as a result of download; in commercial lines, 38% found savings of one hour or more per day.  Interestingly, about one in four respondents said that they didn’t know how much time was saved.  Some of these respondents  said they had always used download, so had no basis for comparison.

The report also found that agents were finding ‘Real-Time’ (defined as ‘ the ability to click on a button from a client file in your agency management system or comparative rater for immediate access to carrier information on that client’) is gaining traction and saving time for both personal lines and commercial lines functions in agencies.  Major functions for Real-Time are rating and inquiry.  The majority of use (and benefits) are found in personal lines use, but commercial lines has a respectable presence.  Overall, where Real-Time  is used, average time savings reported is 50 minutes per staff member per day.

Looking toward the future, the survey found a number of areas that could improve Real-Time for the agents.  The highest on the list is to increase the number of carriers offering Real-Time.

Source: ACT Real-Time & Download 2011 Agency Survey

To support action planning to address these priorities,  the Real-Time Campaign (a consortium consisting of IIABA, ACORD, service and system providers, and leading carriers) developed “Best PracticeWorkflows & Implementation Strategies”  which are available at http://www.getrealtime.org/active/realtimeresources.asp.

So what does this mean for Canadian brokers, carriers, and suppliers?  As we’ve noted, leading Canadian brokers have started a group with similar goals to ACT, called ORBiT.  Great credit goes to committed brokers who have developed committees, brought in sponsors, and have contracted a part-time executive director.  There were very successful Education Days conducted last year to help recruit additional brokers, and another series is planned for this year.  At the 2012 sessions leaders from the US Real-Time movement will be present to give insight into US activities.

All good.  We only see two cautionary elements.

First:  We don’t know the specifics of the curent Canadian broker environment.  ORBiT’s work to date has been commendable, but is missing some of the context that the ACT report offers.  There is no baseline as to the current state of brokers in Canada similar to that offered by ACT.  How many brokers are using download now?  What are the major issues with its implementation?  What inquiry functions are available from which carriers, and how does this help the broker?  There also is no survey of a larger number of brokers and their need that can be used to recommend sets of activities.

It may be that Canadian brokers’ current use of technology and future needs correlate perfectly with their US Counterparts.  But somehow, we don’t see that being the case.  For example, we have several provinces that have government schemes for automobile insurance.  And we don’t know how these differences would colour the needs or priorities of brokers.

We would encourage ORBiT to take some time to construct some data – through surveys or focus groups – and use this information to construct some specific action plans in consultation with other stakeholders – suppliers and carriers.

Second, there is an awful lot to do, with relatively few resources.  Depending on the needs found in the analysis recommended, Canadian brokers might be well served to align itself with their US counterparts and find ways to reuse material developed in the Real-Time campaign.  While there is a natural tendency to emphasize our Canadian uniqueness, if there are areas of common interest with the US, we might be well served to take these as first priorities for action.  If these can generate early wins, they could establish momentum that has been lacking for the past while.

We think with alignment, Canada can benefit from the pioneering work of ACT.  We also believe that there are and will be areas where our experience can benefit our counterparts in the US.  At a minimum, together we can establish better working relationships with carriers and suppliers we have in common across the border.

 

Broker=Carrier Connectivity
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May 05

Implementing Mobile – User Assumptions and Security Realities

By Insurance-Canada.ca BlogEditorNo Comments

An increasing amount of data suggests that consumers and employees are assuming that mobile technologies – smartphones and tablets – will become integrated in insurer offerings  and accepted as normal business tools.   And a number of insurers hare moving from pilot projects to production applications.  One outstanding question is: are security methods and procedures keeping pace?  The jury is still out, but the necessary action plan seems straightforward.

We have noted that the movement to mobile is not restricted to large insurers, and many smaller insurers are finding this is becoming a competitive equalizer.  We have also seen that regulatory organizations in the US and Canada are developing guidelines to encourage the use of mobile devices for financial transactions.  The result has been an increase in expectations.

In a recent opinion piece in PropertyCasualty360.com, Edward Cammarato, John Cantwell, from Verisk Insurance Solutions, noted: “In the near future, customers will ask for mobile solutions to be included in their offerings and demand them at no additional cost. Just as today’s customers have assimilated online payment of policy premiums, they’ll also expect to upload possible claims data (with photos) using their mobile applications”.

At the recent NetVu User Group Meeting, Vertafore President and CEO Euan Menzies in his opening address , indicated that Web 3.0 will have the same level of impact as the original move to the Web with mobility, collaboration and insight driving the transformation.

Continued expansion will be contingent on appropriate security.  So where are we?  First, it needs to be noted that constructing mobile security for the insurance industry is complicated  because of the number of touch points that the insurance industry has.  Quoted in Insurance & Technology, Sadik Al-Abdulla, senior manager in CDW’s security practice, said, “Data loss prevention in the insurance industry is particularly challenging because you must follow sensitive data every step of the way.  … There is more opportunity for data loss because the insurance industry handles more data than other industries, and because more employees touch the data.”

In an accompanying piece, Chad Hersh, from Novarica, was asked how the industry was doing, indicated  that he felt it was not that far along.  However, he provided some advice:  “The security requirements for mobile aren’t necessarily novel, but rather are extensions of the security needs of the desktop, the Blackberry, the laptop, and the cell phone.  … That being said, they need to be taken as seriously as those other platforms.”

At the end of the day, business managers and IT staff need to examine the exposures, and the options for providing security.  There are resources to help.  Recently, Insurance Networking News summarized a report by advisers Janco Associates, Inc. on techniques to manage employees’ personal mobile devices, and the results – a combination of technical and procedural recommendations – look like applied common sense, such as: ‘Include remote device wiping’, ‘Provide simple workable solutions that even novices can use.’  The slideshow on INN is worth a look.

The first step needs to be to acknowledge the need, then gather the appropriate resources.  Given the trend, it seems worth the effort.

Bring Your Own Technology, Mobile Technlogy, Security
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Apr 28

Is the Drive to Telematics Hitting Standards Speedbumps?

By Insurance-Canada.ca BlogEditor1 Comment

Telematics-based insurance programmes continue to attract interest from insurers.  However, recent developments indicate that there may be a low level of support for development of common data and technical standards to support generalized protocols for implementation.

As we noted in March, Sandy Dunn, chairman of UK based  telematics solution provider Wunelli Ltd., issued notice that he would host a ‘think tank’ of senior insurer executives to set the stage for development of “a common standard for the collection, verification and security of telematics data.”

Dunn said, “Insurers have a small window of opportunity to agree to a common data standard.”  The lack of a common standard would make required data sharing difficult or impossible..  Dunn also predicted that 15% to 20% of motorists would buy a telematics policy in the next two years and added that unless the industry tackled the issue now, the reputation of telematics could be tarnished.

Seems that his insurer partners didn’t see the urgency of his initiative, and some actually saw significant downside for pioneers.  Within a week of the Wunelli announcement,  Mike Brockman, chief executive of pay-as-you-dirve specialty insurer, Insurerthebox, said that data standardization could remove the competitive advantage from more advanced telematics players.

Cited at the ActionClaims website, Brockman also indicated that the telematics insurance industry was still too immature for these data standards to work.  “The thing with telematics is, it’s anything but standard. It is impossible at this point in time to define what a standard is,” Brockman said.

The Wunelli chairman put a slightly different spin on the cancellation of the think tank session.  Quoted in PostOnline.uk.com, Dun said, “Since our launch of the common standard initiative, we have received almost unanimous support from insurers and industry bodies, which we believe negates the need for a think tank.”

At least one element of Dunn’s concern seems to be playing itself out already.  Dunn said: “We need to be ready or we will face a whole host of challenges, not least the problem of cars being fitted with a different box every time the customer changes provider.”

A recent article,  commissioned for the Telematics Detroit 2012 Conference and Exhibition, referred to competition between the use of embedded technology and smartphone technology as ‘The Great Telematics Battle’.  At this point, there is no consensus.

The articles authors summarize the current state:  “On the one hand, he says, using cell-phone connectivity eliminates the need for another data plan for the car. On the other, an embedded modem usually has better data rates and more bandwidth.The embedded modem has plenty of power, because it can draw from the car’s systems; and it can use the rooftop antenna for a more reliable connection. Yet cell phone towers are optimized for reception from a fixed point, not a rapidly moving vehicle.”

While the lack of standards will not prevent committed insurers from implementing telematics-based  insurance programmes, it may cause others to slow plans for pilot projects until standards are developed.

Data Standards, Telematics
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Apr 26

Consurmerization of Insurance and IT: Who Are Your Role Models?

By Insurance-Canada.ca BlogEditorNo Comments

The focus on the consumer is nothing new for insurers, but the focus on the on-line consumer is.   As we ponder how we will shape insurance products and services for the on-line consumer of the future (who is likely in our client file or on our prospect list now), one of the best questions we might ask is:  “Who are our role models?”    We might be surprised at the outcome.

According to Neff Hudson, assistant VP of emerging channels at San Antonio-based USAA (a US direct writer, focusing on a full range of insurance and financial services for military and government personnel), Amazon,  the on-line book seller, has been a role model for USAA for the past several years.   Cited in Insurance & Technology, Hudson says his organization is especially impressed with Amazon’s use of predictive analytics to up-sell and cross-sell at the point of sale.  Hudson believes this has significant potential in his company, allowing CSRs to make very specific suggestions.   “For example: ‘People like you need life,’ ‘People like you need this much comprehensive coverage,’ ‘Have you considered umbrella insurance — because people with your asset class tend to use it.’ ”

The move to an on-line world is changing the relationship between the provider and the customer.  Insurers can benefit from the use of analytics to suggest products, but the consumer will also expect that the insurer will use information to simplify the buying process.    The Insurance & Technology article notes that Esurance, Allstate’s on-line unit, pre-fills portions of applications with data from proprietary analytics,and has other point-of-sale initiatives in development.  Lisa Ward, VP of customer experience and communication at Esurance says, “This helps them make more-informed decisions throughout those processes, and helps us improve customer satisfaction.”

As insurers enter the world of the on-line consumer,  there is a temptation to assume that products and services are sufficient and that IT is simply a channel.  We should remember that IT is struggling with its own consumerization issues.  In this regard, we might look at how IT is (or is not) coping with organizations  like Apple, which are allowing users to act as their own IT departments.

Technology journalist, Ryan Faas, blogging from the Recent Consumerization of IT in the Enterprise (CITE) conference in San Francisco suggested that it is IT that needs to change, not the consumer: “As people become comfortable buying and managing their personal technologies with a newfound ease, they integrate them into their everyday lives more deeply than ever before. That builds more comfort, which drives even deeper adoption. … IT needs to get on board with this shift and rewrite its own DNA. With consumer devices that come with their own Internet connection and ever-growing ecosystems of tools, users can simply ignore IT if they choose.”

If we change ‘IT’ to ‘Insurer’ in the previous quote, we might see a suggestion for another role model insurers can emulate.

Analytics, Consumer Insight and Action
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Apr 22

Data Analytics in Modern Risk Management

By Insurance-Canada.ca BlogEditorNo Comments

We have written in this space on the variety of uses  that insurers are finding for big data and analytics to understand customers. It seems that professional insurance customers, with the support of their brokers,  are seeing benefits from sophisticated analytics as well.  And analytics may be emerging as a critical tool for risk managers in their overall role.

As reported in the Insurance Journal, a recent survey of  corporate risk managers by Towers Watson found that 63 percent of survey respondents are either seriously or moderately concerned over a hardening property/casualty insurance market. To respond to this, the majority of respondents are preparing to take their programs to market.   Respondents indicate they are using broker supplied data and employing sophisticated techniques – including catastrophe modelling, retained loss analytics, and predictive modelling – in marketing their programmes.

Steve Levene, Risk Advisory and Brokerage practice leader for Towers Watson, says, “With all signs pointing to a hardening market, actively engaging in the use of analytics is a great way for companies to prepare themselves for change.”

Insurance purchasing may be just one area where analytics supports the professional risk management role

Norman Marks, who write extensively on corporate governance best practices, sees the role of the risk manager expanding in modern business to help analyze risks (and opportunities) in complex business environments.

He recently blogged on the expanding role of the risk manager:  “To manage the business going forward <large organizations> need the risk management capabilities to support scenario planning and risk mitigation and information based on more than just a finance or a process perspective. They need to be able to look at different markets, customers and product lines in a more sophisticated manner and ultimately to be able to adjust the dials as they try to take business forward in a more complex environment.”

As we posted back in January, “The rapidly accelerating needs of organizations to better understand and predict consumer preferences and behaviour, using larger and less structured data sources, are causing these organizations (including insurers) to adopt new enterprise models and to appoint leaders with new titles and broad responsibilities.”

Maybe ‘Risk Manager’ is one of those job titles.

Analytics, Risk Management
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