Insurers have found immense value in the data they gather. This is because data is considered to be the most valuable currency in the digital age. They have a stockpile of invaluable information such as client information, claims data, market data and more. Many businesses don’t yet know how to take advantage of data, but the insurance industry has figured out that big business insights are key to maximizing their potential.
According to Dresner Advisory Services’ 2020 Business Intelligence Market Study, financial institutions such as insurance companies have high rates of adoption for cloud business intelligence. This is due to the fact that insurance business intelligence is integral to each of their jobs — from risk management to client relationship management and compliance.
Insurance companies can increase their profits by understanding business intelligence, such as what it is and how to use it.
What is Business Intelligence?
Business intelligence software provides detailed visual representations of operations and business processes. The software gathers information from a company and creates an image of its data, which is then used to make important business decisions.BI is the process of analyzing and interpreting data in order to obtain valuable insights that influence business decisions.
BI is the process of analyzing and interpreting data in order to obtain valuable insights that influence business decisions. Business analytics and business intelligence often get confused. While both do similar work, they aren’t the same.
Business intelligence analyzes data and identifies trends. It also predicts the outcome of a given action or behavior. An example of the work an auto insurance underwriter could perform using business analytics is determining the risk of a specific driver based on their driving history. This data would be used to calculate premiums on both gross and net levels. After that, a policy would be issued to the driver.
Having business intelligence systems that include data analytics capabilities makes providing insurance more efficient. Rolling data integration and migration functionalities into one software system promotes better data quality by combining functionalities like management and migration.
6 Methods For You Profit from Insurance Business Intelligence
1 – Combat Insurance Fraud
Fraud is rampant in the insurance industry. It’s a sad but true fact that insurance companies must take precautions to minimize fraud.
The United States Insurance Fraud Complaint Coalition claims insurance fraud costs the country $80 billion each year. This doesn’t just affect insurance companies — it also hurts the insurance payers who end up paying for it. Insurance companies lose money due to fraud, which causes them to increase premiums or costs to make up for revenue lost. This decreases customers’ satisfaction with their insurance and increases fraud costs for the average American family between $400 and $700 per year. The Federal Bureau of Investigation states that insurance fraud costs the United States $400 to $700 annually on average.
Insurance software that contains business intelligence can identify fraud in many forms. This is accomplished through combining artificial intelligence, machine learning, data mining, and predictive modeling. It can detect fraudulent claims earlier in the claims cycle by analyzing data and patterns. This software can present complex information in an easily understandable way thanks to visualizations that use predictive models. These alerts can be automated thanks to the information presented, which identifies fraudulent activity in patterns.
2 – Build Efficiency Into Claims Management
Insurance claims take a long time to process. This is because insurance companies need to thoroughly investigate any accidents, theft, or other traumatic events that their customers may suffer. By streamlining the process of claims investigation, insurance companies can increase customer satisfaction and minimize financial losses. Additionally, this lets agents prioritize more cases and resolve open claims faster. This allows agents to spend more time with each customer instead of processing hundreds at once.
Insurance providers can obtain detailed records of their customers through the use of CRM and business intelligence software. Insurers will provide claims handlers access to their profiles, which can be used to review previous claims. These programs will allow claims handlers to deliver more personalized customer service and make it faster. These solutions give claims handlers a holistic view of key business processes and performance.
3 – Identify Profitable Opportunities
Because insurance companies need to maximize their earnings like any other business, they need to have executives with the ability to view their entire business from a single location and in a convenient format.
Software for business intelligence provides users with a complete understanding of their data by combining data analysis with visualizations. This software is used by companies and organizations to better understand the performance of their partners, products and services, as well as themselves. It’s also helpful to insurance companies; they can use it to detect fraud, analyze trends and determine more strategic business moves.
4 – Better Enable Your Sales Team
Insurance sales teams need to monitor each territory, product and employee to ensure their quarterly goals are met. This is due to the large catalog of insurance products they manage around the world. Insurance company sales teams are stacked against them because of this close scrutiny, which managers require in order to consistently meet their goals.
Insuring businesses can quickly determine their individual products’ and agencies’ performance. This is because insurance business intelligence solutions provide real-time reports with visualizations that show the performance of each. This makes it easy for business managers and representatives to understand which areas need improvement or additional attention. Plus, this data helps them identify growth opportunities.
5 – Optimize the Underwriting and Sales Processes
Claims platforms provide Claims Management with added efficiency when processing underwriting and sales processes.
Insurance companies use BI to understand the underwriting process in a holistic way. By studying data visualizations about each stage, information can be easily gathered about each individual step. This can help eliminate bottlenecks and identify opportunities for improvement.
Insurance business intelligence can be used to support sales efforts by aiding cross-selling and upselling. Submissions like quotes can be used to see how many quote requests are made per product, region, company size or industry. This information can be segmented by company size or industry in order to help sales teams make additional sales opportunities through reports such as the white space report. Insurance BI can also be used to help commercial insurers segment their submissions by company size, region, and product. This way, they can identify opportunities to sell additional policies via reports such as the quote request report.
Painting a more complete picture of available sales opportunities through the inclusion of support lines for each policy is possible thanks to BI. For example, a commercial auto insurance salesperson can recommend additional related policies— such as commercial property or worker’s compensation — when renewing a customer’s auto insurance policy.
Reviewing previous submissions allows both the sales and underwriting teams to examine comments from policies they’ve already reviewed. These might include changes in premium payment or why premiums changed.
6 – Discover More Opportunities Using External Data
Insights into insurance business intelligence can provide new opportunities for improving existing procedures and creating new processes.
By monitoring weather patterns through data from the National Weather Service, you can provide visual representations of current weather conditions that allow you to project weather patterns by region. Next, you can use this data to overlay policyholder data to produce models that predict future weather. You can then alert policyholders to take specific actions because of the upcoming weather — say, advising them to store their car in a garage to avoid hail damage.
Creating upsell opportunities is one of the many benefits of clever reminders. For instance, reminding people that certain regions frequently experience hurricanes, snowstorms, tornados or other severe weather can cause people to purchase additional coverage and higher premiums. This is because these reminders encourage customers to purchase extra coverage before their policies are damaged.
Insurance companies use information gathered from different sources to create insurance policies. This can range from data pulled from weather patterns to information obtained from services that report financial data.
Choose Power BI for More Intelligent Decision-Making
Insurers can use Power BI for Insurance to gather data from their day-to-day operations and use that information to improve their business. This includes analyzing data gathered from claims, business transactions and more. Power BI for Insurance provides insurance companies with powerful data analysis tools, 360-degree business dashboards, and other interactive features.