The rapid availability of data in the insurance industry has made a decisive difference today – it promotes competition in the healthcare sector and drives further innovation worldwide. In conversation with IBChristina Lucas (pictured), global industry consultant at Guidewire, said it was a revolution in the way they do business.

“The availability of data has really leveled the playing field,” she said. “Operators can develop new products and services thanks to the transparency of the information they now have.”

Initially, companies focused on reporting historical data trends, but this practice has been turned on its head.

“Ten years ago, the development of forecast models was the most important thing,” said Lucas IBToday, the industry is characterized by sophisticated models that leverage business intelligence to achieve data-driven business outcomes. This shift from two-dimensional Excel spreadsheets to advanced technologies such as large language models and generative AI represents a tremendous leap.

“It’s fascinating to see how we now use complex data to gain insights that help us make decisions,” Lucas added.

And if anyone can spot these trends early, it is Lucas. As a speaker at IBAt the upcoming Women In Insurance New York event, her session “Opportunities Through Numbers – Revealing Data-Driven Industry Insights” will enhance your market understanding for informed business decisions and help you gain valuable insights on:

• Industry data reveals weaknesses and opportunities
• Improved market understanding for informed business decisions
• Insights and tools to navigate market conditions
• A data-driven approach to tackling industry-wide challenges

In the insurance sector, the integration of AI has also revolutionized the analysis of claim information, which traditionally contained huge amounts of data. According to a study by Appinventiv, the market value of AI in the insurance sector is expected to reach $35.77 billion by 2030 – with 77% of insurance professionals already using some form of AI in their organizations. And for the insurance industry, the adoption of AI is acting as a catalyst for massive, comprehensive innovation.

“Underwriting and claims processing used to be siloed, with minimal interaction between the two,” Lucas said. “Collaboration between underwriters and claims adjusters helps create more streamlined models based on new trends.”

“It’s not just about having the data, but making sure it’s the data needed for future insights.”

But it is not just technology and data that are changing the rules of the game – geopolitical events have also played their part in the evolution of the sector – especially the global pandemic.

“COVID-19 has brought business disruption to the forefront and challenged us to quantify its impact,” Lucas added. “We use data to understand supply chain logistics risks and agricultural risks, particularly in relation to climate change. Shippers are now ready to create data sets that can be shared and even monetized. Different companies can apply their technical expertise to the same data set, creating diverse and innovative products.”

For insurance executives, the key to using data effectively is collecting the right data, sourcing it from third parties, and employing data-savvy talent.

“It’s not just about having the data, but making sure it’s the data needed for future insights,” Lucas said. “Telematics, for example, provides valuable data points for understanding risk profiles. We need data-savvy people who can interpret data based on their industry knowledge.”

“Insurance leaders must focus on collecting relevant data”

Looking ahead, Lucas sees two major trends in data usage in the insurance industry: technical enablement and market capabilities.

“The technical support includes real-time data inputs and cloud-based platforms that are essential for rapid decision-making,” she said IBAnd when it comes to market capabilities, Lucas highlights the rise of cyber and incident response, climate modeling and sustainability efforts.

“We are seeing significant advances in climate modeling and the use of blockchain in parametric insurance. Digital-forward solutions require platforms that can process real-time data and are often based on cloud technology. Insurance leaders must focus on collecting relevant data, leveraging third-party sources and nurturing data-savvy talent to stay ahead.”