IPhone and iPad users (including me) were surprised to learn yesterday that their devices store location data gleaned from pinging cell towers, even transferring it to the computers to which they are synched. Someone even wrote a program that maps all the data, which, while somewhat cool, is also a little concerning. While I've known for a while that carrying around a cell phone is carrying around something that can be discovered at any time as long as it's connected to a network, running the program and seeing big clusters of data around New York (where I live), Phoenix (the I&T summit), Orlando (a CSC event I went to) and Maine (summer vacation) was jarring.
When I found that this data is already being used by police, I started to wonder: What could insurance carriers do with it? I checked in with Mark Breading of SMA to find out.
I&T: Were insurers aware that iOS devices were storing this kind of location data?
MB: I don't know if it was generally known by insurers that just by having a phone they were storing the data. I think it was generally known that apps could collect location-based data, because a lot ask you if you want to opt out or not.
I&T: Do you think insurers will want to find ways to use this data, or is it too hot to explore right now?
MB: If there's any place they would leverage it it's in the claims area — they're already using social media for investigations there. But I see a slow uptake. There will be a new privacy battle. In theory you can better understand risks, better advise clients on loss control and risk managements, better investigate claims. It can be advantageous to both their client and their insurer. But it's taken 15 years for pay-as-you-drive insurance to get off the ground, for example. The right approach for carriers is to over time think of ways where your policyholder opts in and that information is advantageous to the policyholder and the carrier.
I&T: With mobile and social media, there's a lot more content and data available to insurers than there has been traditionally. How quickly do companies want to adopt this information for business use?
MB: Over time, more and more real-time risk data is becoming available to the marketplace. There's more providers that have detailed, visualized information about impending weather events and crime patterns and all kinds of things. In theory you could marry that up to location-based info for a particular client and provide them advice and guidance. I think the leaders are going to experiment with it just like they always do, but I don't think there's going to be any large rush toward this. Carriers are busy enough trying to catch up and refocus after a couple lean years and address the latent demand they have for IT services.
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