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Many insurers are still struggling to achieve a 360-degree view of their customers. A primary reason is that senior executives are unaware of the opportunities their business intelligence systems can provide.
Despite their hefty and increasing investments in data warehouses, architectures, analytics, and business intelligence (BI) platforms, many insurance companies still are not getting the value they want, and need, from their BI initiatives.
In essence, past business intelligence initiatives in insurance amounted to the status quo: simple spreadsheets.
For insurers to achieve the desired ROI from large BI investments, they will need to tweak their programs to provide the right information to employees in a timely manner and in a format that helps them analyze, evaluate, and react to changing market conditions to drive business results.
How is it that carriers, supposedly with better data and systems, are still generating reports that offer little insight and impact on the business? There are three primary reasons:
The promise of BI has not faded. Given today’s growth and advances in analytics, BI remains a compelling way for insurers to incorporate business insights into business processes and open up their growth potential. Insurers can use BI throughout all aspects of the organization, giving employees greater insight to improve performance.
This is the real promise of BI, translating insights into action and empowering the business to act differently. By having both accurate data and analytical prowess, insurers can determine the impact of a situation on their business and devise appropriate ways to respond. And, they can push these capabilities to every line professional in the company.
The bottom-line is clear: for insurers to achieve the desired ROI from large BI investments, they will need to tweak their programs to provide the right information to employees in a timely manner and in a format that helps them analyze, evaluate, and react to changing market conditions to drive business results.
Customer acquisition and retention over the next three years will depend heavily on an insurers’ ability to deliver customized experiences to their different customer segments—an ability that will rely on predictive analytics to convert data into usable insights on customers, agents and markets. Historically, predictive analytics in insurance has focused on risk segmentation or pricing. However, it has far broader uses for insurers; it can be applied to key operations of the business to optimize performance in every area. For example, predictive analytics can answer key questions in moving from analysis to action, such as:
To gain more insight and value from their BI investments, insurers will need to go further toward the holistic view by taking six key actions:
August 31, 2012
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