Insurers Are Missing The Data-Mining Boat, Deloitte Says

NU Online News Service, March 30, 2:32 p.m. EDT

Insurers have a wealth of customer information they could employ for product marketing, but lacking data-mining strategies, they don't use it, a consulting firm advised.

That inability is a failure of management, not technology, experts said at a webinar sponsored by the New York-based consulting firm Deloitte, titled "Prospecting for Gold in the Insurance Data Mine."

Arun Prasad, senior manager with Deloitte, said insurers face four major challenges when implementing data mining.

One is an understanding of who owns the data. The major hurdle here is defining the customer, because there is no standardized way in this industry for owning the customer and defining who the customer is.

He said carriers do not have an effective strategy in place for dealing with their data. This primarily comes from the fact that information is often kept in business silos, he explained.

The silos need to be broken down and the data integrated across the entire business to be effective, Mr. Prasad advised.

He said management must also work for incremental change and not think in terms of "a big bang" solution.

Finally, Mr. Prasad said the issue of data mining is not a technology issue, but a governance issue. Technology experts and management need to work together in order to achieve workable solutions to creating an effective data mining system "regardless of where the data sits," he explained.

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