A little less conversation, a lot more action
Tactics to help insurers get satisfaction from data analytics
Data, and making sense of it through analytics, is at the heart of all disruptive innovations and key to o becoming an insurer of the future. It’s in the DNA of start-ups, who continue to grow and develop game changing propositions. But are insurers tipped to be at 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.
Our survey told us 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, we found that on average, investment in non-technology related analytics is only planned to grow between 10-20% per annum over the next 3 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, this disconnect needs to be tackled if insurers are to defend their market share.
Our study sets out how insurers can overcome the key challenges related to data analytics, and how to, through using the 3 pillars of our global framework, transition into becoming an Insight Drive Organisation (IDO).
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 our popular paper ‘Turbulence Ahead – The Future of General Insurance’ (PDF).