Data is the new oil. Or so it has been said. This is evident in the number of effort businesses give in collecting customers' personal data these days.
Data analytics is changing the way insurance companies do business. To provide better services to policyholders, insurance companies are collecting more and more personal information from their customers.
While big data can be very beneficial to insurance companies, it can be very daunting for those that haven't adjusted. Still, data analytics is having a huge impact on the insurance industry.
A large amount of data is collected in the insurance industry. This data is then properly analyzed in order to provide custom services to policyholders.
Download our E-Book: Profit and Loss Management: 3 Ways to Do it Right
Here are a few ways data analytics are improving the insurance industry:
Big Data Analytics and Customer Loyalty
Some insurance companies end up getting far more customers than others. This is because they are usually able to give customers exactly what they need, which in turn builds customer loyalty.
A loyal customer is a satisfied one. And a satisfied customer is less likely to switch insurance companies in search of cheaper quotes.
In order to provide customers with exactly what they need, insurance companies need to collect all their necessary personal details. Once this information is collected, big data analytics is used to determine the best insurance product that matches their needs. In this way, they keep their customers satisfied and loyal.
Data Analytics and Fraud Reduction
Fraud is rampant in the insurance industry. An alarming number of claims are filed fraudulently—1 in 10 cases, according to industry findings.
Some of these cases are easily identified and the requisite action needed to reverse the situation. However, fraud cases have become more difficult to track as persons are more meticulous with their fraudulent activities.
Data analytics helps to reduce fraud in the insurance industry. With big data analytics, more data can be gathered and analyzed in less time. This allows companies to collect more data from customers in order to better assess individual customer situations and prevent fraudulent activities.
Challenges Faced when Using Big Data
Big data analytics definitely has its benefits in the insurance industry. However, there are some downsides to be considered. Here are some of the issues faced when using big data.
- Big data requires multiple tools to be processed. There is a lot of data to be processed in the insurance industry. Processing this data might become problematic, as some data might be lost.
- The amount of data gathered in the insurance industry can become overwhelming. If this data is not gathered and unified properly, it could become chaotic and difficult to manage.
- Sometimes too many analysts are brought in to analyze the data collected.
As time progresses, the importance of data increases. Especially in the insurance industry, big data analytics is essential for processing this much data, to prevent fraud, and build customer loyalty.
Outsourcing your data and research processes for your insurance business can work wonders for increasing productivity.
Would you like to discuss the potential of outsourcing some or all of your data and research processes? Infinit-O builds teams of data and research specialists for our clients made up of experts in the industry. We understand the need for accurate data analytics, especially in the insurance industry, and we choose our workers accordingly.
Infinit-O is your trusted, GDPR-compliant business solutions partner, ideal for any insurance company ready to take data analytics to the next level. Clients data is under strict security to resist hackers and other security breaches. Our operations are extremely client-focused, and we take a customized approach to solve each of our client's business challenges. We operate on a scalable model, and our clients are able to start with a small, dedicated team for their outsourcing needs, then scale up or down as needed. With updated and reliable technology infrastructure, not only can we provide excellent solutions, but we also make sure your data is secure 24/7/365.