The importance of a good data strategy
Digitalisation in the insurance sector
In the age of digitalisation, data is the fundamental asset of any kind of company, including those in the insurance sector, as it is essential to manage, analyse and apply a large amount of information in order to automate processes, streamline internal management and continuously improve customer experience.
For this reason, the definition and implementation of a data strategy is considered a key line within the objectives of an organisation, as it provides a common knowledge of the main variables, which facilitates collaboration between areas of the company and contributes to reducing time to market.
The main goal of a data strategy is the creation of a solution, in the form of an information platform, that will meet the needs identified by the company not only today, but also in a time horizon aligned with the medium-term strategic plan (between three and five years), and which is flexible enough to evolve as needs change.
Such a solution allows the company to have a solid base to consolidate its activity, guaranteeing a single source of truth for the entire organisation, ensuring the availability of quality data, managed and governed in accordance with well-defined policies, and being the central access point to cover the analytical and business exploitation needs that are identified. Ultimately, the goal of a data strategy is to obtain the desired golden source.
THE BENEFITS OF SUCH A PLATFORM ARE CLEAR:
- Corporate repository with all the information of interest to the insurer.
It simplifies access to data and ensures the availability of data in due time and form
- Guarantee of suitability and quality.
It reduces information processing efforts when covering information exploitation needs.
It facilitates the management of security and access control policies so that they are clear and appropriate to the sensitivity of the data and its possible uses.
- Defined data governance policies.
They make it possible to know, for example, the origin, business concept, processing carried out and available history of the data, providing the organisation with the necessary traceability to guarantee the correct use of the information at all times.
When assessing the features and capabilities of an information platform, it is important for the insurer to consider its corporate strategy, depending on the expected maturity of the platform over a given time horizon. For example, the trend towards incorporating unstructured information – from call centre conversations, images of the accident, IoT devices and social media, to name a few possibilities – means that storage and processing technologies are needed for both unstructured data and traditional structured information.
In addition, the insurer should not forget the various regulatory requirements, e.g., in terms of security and data protection, which may affect its decisions with regard to some fundamental aspects, such as the possibility of using the cloud, since the conditions to be met depend on many different aspects, including the type and nature of the data, the geographical location of the user, the specific regulation and the business partners.
Finally, the insurer needs to properly consider and manage the organisational impact of its strategy, as a data platform requires the existence of specific governance bodies and individual roles with clearly defined functions and responsibilities regarding, for example, the role of data in the organisation, the rules for its use, and both the definition and monitoring of information management practices. All this entails new ways of working and, therefore, an appropriate change management policy will facilitate the adoption of the new practices by all the people involved and will avoid the adoption of inefficient procedures or tools. The involvement of the whole organisation in this process is fundamental to achieve a solid data culture.
In conclusion, obtaining value from data is a differentiating factor for any insurer, as it provides it with the necessary capabilities to face current and future challenges, such as the creation of personalised strategies adapted to the omnichannel approach, the design of unaided processes (RPA) that respond to customer needs and the obtaining of specific knowledge useful for aligning decisions with the expected behaviour of the market. Therefore, corporate adoption of a data strategy that leverages these capabilities enables insurers to offer more efficient and value-added products and services, which is a competitive advantage.