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In a global study by Bain & Company in 2014, 79 percent of respondents said they would use digital means over the next few years to buy insurance and interact with insurers. This statistic and others show that consumers are embracing the digital insurance marketplace—and they’re doing so faster than many in the industry can keep up. Baby boomers are beginning to demand the same instant results as millennials. Insurers who ignore that may be setting themselves up for failure in the not-too-distant future, but many carriers don’t know where to start.
Statistical Analysis Gets You Started
Embracing the market’s digital shift not only gives insurers and brokers a strategic advantage in terms of client relationships, it also gives them access to huge amounts of data—big data they otherwise wouldn’t have. More importantly, with statistical analysis systems readily available, insurers have never been in a better position to analyze this proprietary information.
Insightful, accurate information tells a story that helps insurers develop products with wider market appeal while structuring both coverages and premiums for ultimate risk mitigation. But statistical analysis doesn’t mean that solutions are simply handed to you. An insurer must be forward-thinking to capitalize on the story the data delivers. Insurers also must be able to integrate data acquired from all sources—including traditional physical sources that haven’t been totally eradicated.
The Cloud Can Put You Ahead
There are two main cloud options: public cloud and private cloud. A third option, hybrid cloud, combines public and private features. Public cloud is a cost-effective way for firms to share resources and access email online anywhere. But insurers may worry about the security of sensitive information. Private cloud is on a private network from either a third-party vendor or run in-house in the insurance company’s data center. It will often adhere to specific and usually stricter security guidelines than the public cloud.
Hybrid cloud is a cross between the two. You can put less-sensitive data on a public network and more-sensitive info on a private network. For example, CRM could be on a public cloud and various applications—for example, sales and underwriting—could reside on a private cloud in the insurance company’s data center.
By applying statistical analysis to big data stored on the cloud, insurers will now be able to far better analyze the data they collect. And Identifying the trends and upcoming shifts will allow them to develop products and solutions to put them ahead of the industry.
Additionally, insurers need to be suitably equipped to roll out their newly developed products and coverage options to the market—something else that cloud technology helps with. Retrofitting a legacy system to handle new products is both expensive and inefficient, and does nothing to help build relationships in the digital age. Instead, insurers need to implement a technological foundation that allows for automated underwriting, seamless data integration and single-data entry.
The Big Story
Data isn’t just about facts, figures and odds. Big data tells a story about the lives, needs and concerns of our clients. And if we’re prepared, it’s a multifaceted tool we can use to pull ahead of the pack.
In the digital insurance marketplace, insurers constantly collect data that is weaved into the narrative of our clients’ lives. But it’s the way we interpret and use this data that creates our story—the story of our business, our future and our success.
By finding ways to integrate data into our collective narrative and reacting with responsive product development, we take over the role of storyteller and gain the ability to write the ending we want to see.