Amid international privacy concerns, data providers work to assure a worry-free future
Boston, MA (Nov. 27, 2018) – With the rise of predictive analytics and the need to optimize customer experience in digital channels, insurers are increasingly leveraging third-party data sources and services. Insurers are looking for richer information and to minimize the need to directly interrogate prospects and claimants. Both traditional data services providers and new insuretechs are offering solutions, but navigating the provider market can be challenging for insurers. In a new report, External Data in Insurance: Overview and Prominent Providers, research and advisory firm Novarica reviews an array of cases for industry use of third-party data and provides examples of insurers that are investing in this space. The report also profiles 29 data providers used by insurers.
“Insurers primarily use third-party data in three main areas: marketing, including market targeting, segmentation, and prospect profiling; underwriting, as requirements for individual risks or to build predictive models; and claims, as supplemental information to evaluate individual losses or to build predictive models,” said Jeff Goldberg, Senior Vice President of Research and Consulting and lead author of Novarica’s new report. “All of these uses, especially predictive modeling, are becoming more common for insurers, although mature capabilities are rare.”
Among the key findings of the report are:
- Drivers of third-party data usage include AI, customer experience, cost, and regulation. The need for large datasets to train AI and customer buying experience expectations as set by online retailers stand out as relatively new motivators.
- Privacy concerns have made transparency in use of data critical. Scandals such as Cambridge Analytica, along with the GDPR and similar regulations, have increased the demand for transparency in what data is used for which purposes.
- As core systems providers increasingly incorporate AI and analytical capabilities, the hunger for data will only increase. The good news is, this will lead to greater efficiency and improved consumer experience.
A preview of the brief is available online.
Insurers are increasingly interested in leveraging third-party data for analytics augmentation, for predictive modeling, and for the validation/cleansing of existing data.
This report reviews multiple insurance industry use cases for third-party data and examples of insurers that are investing in this area. It also includes profiles of 29 data providers used by insurers.
Click here for the table of contents or to access the report.
Novarica helps more than 100 insurers make better decisions about technology projects and strategy through retained advisory services, published research, and strategy consulting. Its knowledge base covers trends, benchmarks, best practices, case studies, and vendor solutions. Leveraging the expertise of its senior team and more than 300 CIO Research Council members, Novarica provides clients with the ability to make faster, better, more informed decisions. Its consulting services focus on vendor selection, custom benchmarking, project checkpoints, and IT strategy. For more information, visit www.novarica.com.
Source: NovaricaTags: analytics, data, Novarica, third-party data