Technology has a massive potential to change long-standing models of the insurance business. Insurance brokers make the most use of the data they handle in the placement process, taking their relationships with customers and insurers to a whole new level.
Being the mediators between insurers and their clients, historically brokers had access to vast amounts of data even the largest insurers couldn’t have. However, in the recent years the brokers’ willingness and ability to gain better data and analytic tools have changed.
Small technology insurance intermediaries, in contrast to some major insurers that might have certain legacy technology systems, complicating the employment of innovative analytic technologies, are able to use data much sooner. What’s happening right now is that people start realizing that to ensure better decisions it is necessary to harvest the data and after that use analytics to harness its power.
Global placement CEO at Willis Group Holdings PLC, Alastair Swift admits that data and analytics are the cornerstone of their proposition and the WillPlace tool they have is essential in processing data before feeding it into algorithms for finding optimal insurance solutions. Interesting, that a large incentive regarding the data-centric placement mechanism was expressed by the customers. Analytics create an audit trail the customers will show their boards, while explaining why they chose that particulate insurer.
The increased use of data and analytics by intermediaries allows complementing the real-time facts with market knowledge and experience. Combining data science with traditional broker skills – taking the better of two worlds – is becoming an imperative prerequisite to becoming a successful intermediary. The new approach changes the course of business relationships, where the clients are directly connected to the market.
The speed of employing analytics inside the insurance industry will be a defining factor as to who takes the lead on the market, and this shift seems exactly what the clients have been waiting for.