Tactics to get satisfaction from data analytics
EMEA insurance data analytics study
Data, and making sense of it through analytics, is at the heart of all disruptive innovations and is key to becoming an insurer of the future. Data is in the DNA of start-ups, which continue to grow and bring game-changing propositions to the market, and yet data is often overlooked by incumbents. Will your current tactics get you to the top of the league?
A little less conversation, a lot more action – tactics to get satisfaction from data analytics, is an EMEA-wide paper based on interviews with 68 insurers across the region. The responses included 8 out of the top 10 European insurers, based on a classification by total assets under management.
The survey found that insurers are struggling to realise the true value of their data. In fact, almost 90% of respondents struggled to articulate the return on investment made in analytics capabilities.
Furthermore, on average, investment in non-technology related analytics is planned to grow only between 10-20% per annum over the next three years. This slow, linear increase is in stark contrast with the boost being received by insurance start-ups from investors. Incumbents should be concerned about these investments, as they provide competing start-ups with the freedom and agility to explore, innovate and exploit new routes at an alarming place.
With only 11% of surveyed respondents deeming their analytics and business strategies fully aligned, insurers need to tackle this disconnect in order to defend their market share.
The study sets out how insurers can overcome the key challenges related to data analytics, and how they can transition into Insight Driven Organisations (IDOs) using our global framework.
Key messages & recommendations to become an Insight Driven Organisation
- Adopt a holistic approach – move away from the piecemeal approach of tactical point solutions and towards building enterprise-wide capability suitable for the future, by delivering value through initiatives which support the insurer’s ambitions.
- Recognise limitations and leverage ecosystems – incumbents will be rapidly left behind if they continue to do everything in-house and focus solely on building their own capabilities. Insurers must recognise when to partner and when to invest, and this would enable them to move forward in a much more innovative and agile way.
- Prioritise change management – change skills are often underestimated and undervalued, but analytics transformation cannot succeed without them. It is time for insurers to start addressing this by thinking about how they educate the business, engage stakeholders and drive behaviours which support insight-driven decision making.
The report builds on some of the themes covered in Turbulence ahead - The future of general insurance.