Life Insurance companies have always used key data to calculate risk and return, but there is new technology that can make a big difference. Utilizing Big Data for Life Insurance and Annuities can discover big opportunities for sales, marketing and underwriting life insurance products. It can be a potential gold mine for this industry, which has shown stagnation recently.
Many companies know the value of this information but still fail to use it to their advantage. Big Data can tell you more about your business and customers than historical claims and mortality reports. New technology is the biggest driver of this information, which can be found from various sources on the internet.
What is Big Data?
The amount of Big Data is growing at an exponential pace and there are many sources that can give life insurance companies what they need to be competitive. The sources of Big Data collected during customer relationships include smart phones, social media, credit reports and website analytics.
With this information, life insurance companies can more accurately correlate premiums to risks. The information includes key points beyond what is given during the application time of life insurance and annuities. This additional Big Data can be information on health, behavior and lifestyle.
How can life insurance companies profit from Big Data?
The more life insurance companies know about their customers the greater chance of success. To be competitive they need analytical tools that will store and analyze the data effectively. This leads to efficiency, growth and innovation while it helps life insurance companies expand into new markets that never seemed possible. Big Data, if used with strategic objectives can find valuable solutions.
There are 4 basic ways in which life insurance companies can benefit from Big Data.
Deepen customer relationships when policyholders share additional information over the life of the policy. An example of this are customers joining a wellness program and with the insurer building a relationship by learning more about their current health condition. With a medical checkup and using a regular exercise program they can lower their premium rates and build valuable advantages for themselves and the company.
Underwriting new risks with Big Data analytics for customers that were not worth the risk before. With new technology like real-time analytics, life insurance companies can track their client’s health and manage risk more efficiently. An example would be a client that manages their diabetes to stay healthy and is an asset to the company. Companies can grow substantially by finding these new clients and working with them using analytics. The clients are rewarded with better health progress while providing this relevant information to the insurer.
Enhances the business process using Big Data analytics with life insurance companies improving the efficiency of running a business. Improving the insurance application process with better technology can help increase customer sales.
Sales agents have better technology and data to make better predictions for making sales. This software can indicate who is more likely to purchase a policy, by using the metrics provided by Big Data collection.
In marketing, life insurance companies are using advanced analytics to predict who will buy and what chance there is they will cancel the policy. Leads and qualifications are also enhanced with Big Data that reflects a customer’s buying habits.
Increasing market penetration with companies expanding into new markets with faster underwriting by using Big Data analytics and with automation lowering costs. Big Data finds groups of potential customers that add up to billions of dollars. The automation of this process saves money and time with less human intervention.
With Big Data, your life insurance and annuity company can develop a better understanding of the market and existing customers leading to an increase in business. With analytics, you are able to discover information and new markets which were never possible before.
Fast Technology can help build a solution just for your business in the life insurance and annuities market. In this industry, you will be successful with this technology building better relationships with consumers and regulators, contact us for more information.