Data should be collected to help insurance companies better meet the needs of their customers, reports Property Casualty 360. The information that's entered and stored in a database should enable insurance companies to answer strategic questions about their customers, anticipate their needs and look ahead to any additional coverage down the road.
Insurance companies can determine whether they have good data quality
based on their ability to answer those questions, the source adds. It may be a signal of poor quality if they are unable to easily manipulate the information and interpret it to gather actionable insight.
"Analytics hold great promise for the insurance industry, including the application of traditional business intelligence approaches, as well as advanced techniques such as predictive models and Big Data," said Mark Breading, Strategy Meets Action (SMA) partner. "The keys to success for insurers are improving data quality and data management."
It appears that insurance companies are getting on board, since a study by SMA found 70 percent of surveyed industry members plan to spend more this year to improve their use of data analytics, while 52 percent said they're increasing their budgets for product development, according to Information Management.