Using Big data analytics for betterment of Insurance industry
Posted on 06 May 2019
Big data has been used in the financial services industry, including the insurance industry and had evolved a lot
Use big data not just for sales but also for pricing, risk assessment
Insurers are sitting on a pile of data but they are not able to use it to the maximum capacity. There is scope for efficient decisions based on big data not just in customer-facing functions like sales or claims servicing but across the insurance continuum like in areas of product development, pricing, risk assessment, fraud and management.
The challenge for the insurance industry is innovating products and distribution channels to serve new customer needs. In the long run, it will help bring more innovations to the market.
Behaviour analysis for product customization
Insurance products will benefit most from big data. Introduction of sachets, product positioning at aisles and billing counters, and bundling and offering a bouquet of products at incremental price points are areas that have served the consumer goods sector well.
Insurers have a lot of data that is not fully leveraged. Sandbox will help achieve that.
Sandboxing for innovation and test products
The insurance industry enjoys a large amount of data. Big data and its benefits are huge within the life insurance segment, and while we are seeing the benefits, much more can be accomplished.
Sandboxing approach gives us tremendous encouragement to further innovate and test products and services that truly benefit the consumer. The next phase for us will be how to make these processes faster and simpler.
Industry needs to do a lot of ground work to collect data
There is a long way for the Indian insurance industry to go in terms of using big data. With no physical products to manufacture, data is arguably one of the most important assets for insurers. Both, existing insurers and newcomers are developing insurance products and processes that use a large amount of data to assess the price, and to predict and prevent risks that were considered uninsurable in some cases.
The industry has to rejig the mode of distribution where most of the data should be captured upfront.