Big data isn’t the future. It’s the present. And life re/insurers are making it a priority, using data-driven approaches to improve underwriting results and reduce the number of questions and invasive medical tests required in the application process.
All of this was inconceivable just a few years ago. Major factors driving this innovation are:
- A desire to lead in technology and skills adoption;
- Steadily increasing computing power;
- Dedicated business analytics tied to data science algorithms, which are largely new to the industry.
These factors are putting the insurance industry at the forefront of sophisticated analytics on a scale that was previously out of reach.
In my line of work, I look at big data in two major streams.
In the first, big data is being used to help reduce costs and improve the efficiency of current processes throughout the insurance value chain, including claims and fraud management, cyber risk, customer management, pricing, risk assessment and selection, distribution and service management, product innovation, and research and development.