Data and Analytics Will Reinvent Insurers and Insurance, If Consumers Trust Us
Peter Banthorpe, Managing Director, UK, RGA
The continued growth of data and analytics in the world and in the insurance industry is seemingly inevitable. The range of applications and potential value generation is vast including, importantly, value for our customers through better insurance propositions. To realize that value, all companies must tread carefully -- and none more so than insurers. The use of data and algorithms raises fundamental ethical questions fairness and inclusivity. The industry must constantly question itself: Just because we can, does that mean we should? Overstepping the mark could result not only in significant regulatory restrictions, but loss of trust from the industry’s most important stakeholder: customers. Trust is of paramount importance to the insurance industry because we sell largely intangible products based on the promise of a benefit payment should a claim event arise. The industry must resist the temptation to utilize data and algorithms cannot be easily explained to consumers and it must significantly increase the frequency of meaningful engagements with customers. Moreover, the industry and associated professional bodies must seek to engage in a broader societal debate on the value and future of insurance.