INFORMATION EXCHANGE
DISCOVERING INSURANCE DATA INSIGHTS
The factors that go into understanding insurance risk are growing. New data insights are emerging to provide a much clearer, multi-dimensional-like view of each risk to help price fairly and appropriately and support customers based on a fuller understanding of their needs. Thanks to these developments, the broad assumption that an individual is a higher risk because they have had a prior claim may no longer stand.
overall picture of risk. One of the areas in which this multi-dimensional data approach is well-advanced is in private motor. Insurance providers can now understand at the point of quote an individual’s No Claims Discount (NCD) entitlement, the risk of policy cancellation and their predicted claims cost relative to how they have managed their motor insurance policies in the past.
Insurance providers today have access to data attributes about an individual, an asset such as a vehicle, a business or property – all from one access point - that offer a much deeper understanding of risk, allow enhanced personalisation, expedite the quote process and improve pricing accuracy. The growth of insurance specific data attributes has only happened relatively recently, over the past five or six years. This is thanks in large part to the growth of market-wide contributory databases where insurance providers share policy history, quote and soon historical claims data.
Motor insurance providers can also identify potential named driver fraud, such as fronting for a younger driver in the household, and the risk of ID fraud via email address intelligence. Bringing in data about the vehicle build, providers are also now starting to understand the Advanced Driver Assistance System features (ADAS) fitted to an individual vehicle – both standard and those chosen as optional extras - and then how they correlate to claims.
The sharing of this data is just the start. By applying data analytics skills, it then becomes possible to uncover correlations between policy, quote and claims behaviour with claims losses, adding to the
These insights are far from being ‘happy accidents’. They all solve specific pain points for the market and were uncovered by data analysts for that specific reason. Cancellations are costly for the market; named driver fraud can leave unwitting motorists exposed; NCD proof on paper was inconvenient
