Leveraging Consumer Data and Smart Technologies in Insurance: Mind the Gap!

by Nicolas Michellod, January 31, 2017
Industry Trends
Global

Abstract

There is a gap between what insurers think and what consumers think about the use of private data found on social networks.

Celent has released a new report titled Leveraging Consumer Data and Smart Technologies in Insurance: Mind the Gap! The report was written by Nicolas Michellod, a Senior Analyst with Celent’s Insurance practice.

Today, insurance companies have access to a plethora of data, and they need to carefully assess how to capture consumer data and where to find the sources.

Insurers are well aware that customers prioritize the speed to get relevant information and also the intuitiveness of tools and interfaces. There is a gap between what insurers think and what consumers think about the use of private data found on social networks. While almost half of consumers think insurers should not be allowed to use this data without their authorization, this proportion is less than 20% on the insurance side.

Only a minority of insurers have already invested in these technologies, and machine learning has the best traction. However, a high proportion of insurers are going to invest or are thinking whether it makes sense to invest in smart technologies, with artificial intelligence being the preferred technology.

“Insurers need to challenge their current business model in the light of data they can now leverage as well as the technologies available to turn this data into valuable information,” commented Michellod.

“With the importance taken by external data sources and the technologies that can leverage them, insurers need to adapt to make the most of these changes,” he added.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

Key Research Questions

1

Report Methodology

2

 

About the Survey

2

 

Survey Participants

2

The Use of Private Consumer Data

5

 

The Importance of Understanding Customers’ Expectation Preferences

5

 

Approaches to Collect Private Consumer Data

6

 

Perceived Value of External Data Sources

6

 

Insurer-Generated Sensing and Awareness

7

 

Consumer-Led Data Harvesting

10

The Use of Smart Technologies

12

 

Defining Smart Technologies

12

 

Perceived Value of Smart Technologies

12

 

Drivers to Invest in Smart Technologies

13

 

Current Investment in Smart Technologies

13

 

Smart Technologies’ Challenges

15

Final Thoughts

16

 

It’s Not Only About Technology

16

 

Actionable Recommendations for Insurers

17

Leveraging Celent’s Expertise

18

 

Support for Financial Institutions

18

 

Support for Vendors

18

Related Celent Research

19

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