A key consideration the insurance industry needs to address is how best to leverage its investment in technology by using data and analytics to make investment and risk management decisions, according to the most recent survey of insurance leaders released today by State Street.
State Street’s study, “Facing the Future: Blueprint for Growth,” is based on a survey of more than 300 insurance executives globally conducted by the Economist Intelligence Unit. It found that insurers are hungry for better ways to collaborate and share data across their business: 75% of respondents say that using data more effectively across their organization is a challenge for them; only two-thirds believe they have access to data that allow them to understand the total risk exposure in their investment portfolios; and 37% say they are evaluating a large-scale investment in IT systems within the next 12 months.
“Like many large, global institutions, insurers are starting to shift their technology focus from big data to smart data,” said Joseph C. Antonellis, vice chairman of State Street. ““However, disparate legacy systems will make various data and systems difficult to consolidate and analyze. A systematic and fresh approach to updating and properly leveraging these systems will be a key driver for this industry in the future.”
Insurers are also looking to technology to address other challenges, such as a difficult market backdrop with a historically low interest rate environment, matching investment cash flows to future liabilities, and helping to ensure compliance with new regulations and reporting requirements.