Big Data: Ready for Takeoff?
But before you can get to the action step, you need to build the right kind of warehouse to take action on. That's something that Grant Little, director of claims analytics for National General (Winston-Salem, N.C.; $67 million in gross income, fourth quarter of 2013) says that insurance companies need to work on so that their data is more meaningful overall. Especially for claims departments, which Little says tend to be behind other areas of the enterprise in mature use of data and analytics, how data is captured in the warehouse is just as important as what data is captured.
National General's data warehouse, which the company built itself, doesn't just capture changes to claims files; it captures the change log, so that as the claims process changes hands -- a common occurrence -- each new entrant can see when information was learned and by whom.
"Most people start with, 'What do I have to report at the end of the month? Let's build our data warehouse around that,' " Little says. "But that's just static reporting. The real value of the warehouse is being able to capture those snapshots in time. How can you build a predictive model on how to deal with claims types if you don't know when in the life cycle of the claim you captured that data? It's important that you're capturing intraday changes."
Adam Kornick, Progressive
Progressive has found success shoring up the claims department's analytic process with more dynamic data collection as well, says Kornick: "We're building models based on data we have at different points in the claim," he explains.
Kornick describes Progressive's approach to analytics as "decentralized." The company leans heavily on the wealth of data it's gleaned from its telematics program, Snapshot. Much of that data is also useful in pricing and underwriting. So Kornick says he attempts to unify the many analytics employees across departments, to get them to share best practices and identify ways that business units can learn from each other."
"We don't always find that we use all of the same data," he says. "But you look for cases where we can. I'm trying to make sure people understand the concept, that they say, 'I see the analog to that in my space. Maybe I can take what someone in pricing has done and apply it there.'"
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Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio
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