When I joined LexisNexis Risk Solutions 25 years ago our insurance turnover at that time seems insignificant to the value we now provide the market. Back then I never imagined we would see a year of Brexit, Donald Trump’s presidency and Greece considering using the US dollar as its national currency. So as I said recently at the UK Customer Advisory Meeting, major changes can happen outside of our existing experience.
My message to insurers at the meeting was, change is coming, are you ready for it? Can you execute on change, and are you ready for what it will bring?
Insurance markets around the world are increasingly fluid and data-filled. With our recent acquisition of IIL, at LexisNexis Risk Solutions we see some fantastic innovations coming. We are now on a five-year roadmap that will see us making the biggest investments we have ever made, focusing on comprehensive solutions to meet the needs of global insurance markets. In addition to the UK we are expanding in India, Brazil, China and Spain.
But as big data technology is being increasingly overlaid into insurance processes, there are some critical questions we all need to address for the consumer. Who owns the data? Is it the consumer’s own personal data or is it the broker, or whoever owns the consumer relationship?
With these questions comes the important issue of rights to use data and opting in, which is something we see coming more clearly into the data exchange process going forward. After all, the free flow of information has enormous benefits for the consumer.
In the US, 70% of consumers pay lower premiums as a result of our infrastructure, making better decisions with transparency. There is also a role to educate and to work with regulators on the issue of transparency and the many issues around consumer education and the sharing of knowledge.
The speed and direction that data flows in the insurance system is usually not obvious to the consumer, but it must be underpinned by the principle of consumer opt-in. Here’s just one example: Tesla owners have to opt into the Tesla Network as a way to give drivers control over monetization of their own vehicles. Tesla is already collecting over 2 million miles per day of data. So this is just the same as telematics customers opting into the process running in the mainstream OEM market.
With all the new data being generated, we turn to the questions that are critical for our customers: how to make all of the information actionable? What is your definition of this data? It is whatever you need to execute on your strategy. Insights must be built right into the workflow and looking around the industry, the flow of information is massively inconsistent.
Every consumer touchpoint is a test of your knowledge and your insight. At every point you need to inquire, are there any new data assets that you can take going forward? Looking across the whole insurance continuum, I see a lot of inconsistencies globally in these processes.
I would encourage all our customers and industry participants to look at data and focus on using data for improving the lifetime experience of the consumer. How do we all make it easier, as an industry, to grab the data that we’re required to use?
We are moving exactly in this direction. With the acquisition of IIL and its intelligent data solutions we are making it easier to integrate data into the workflows of the market.
Whilst we have been investing in contributory databases, industry data analytics and technology such as our LexID, the No Claims Discount service and MapView with more solutions being developed and tested, IIL has invested in a platform to host client data and plug it into the point of quote. Affinity partners can tailor the flow of data to their brand. All of the disparate data sets are not relevant unless you can get a broad and accurate view of the individual consumer.
As we did with the Wunelli telematics business, we are making it easier for businesses to bring in new data. In this respect we are also working on some important telematics initiatives across Spain, China, the US, Brazil and the UK.
With this constant eye on innovation we will be bringing telematics data to the global data exchange platform and there are some new steps coming. There is the 12V plug-in hardwire device coming to the market, solving some of the issues around the complexity of devices and continuing our work in normalizing, structuring and packaging data points across the whole telematics spectrum.
We are heavily engaged with the auto OEMs on issues around the global telematics exchange and this process continues to speed up as of today. Why are the OEMs so interested in the data space and all that supports the connected vehicle? They are telling us they want to know a lot more about their customers, their behaviours, preferences, the cities they live in, and so on. So for us, there will be a role in future in feeding back information for OEMs to be able to improve their customer relationships, and help insurers future-proof their telematics investments.
Change is coming fast. The average attention span of a human has been falling, from 12 seconds in 2000 – or around the time the mobile revolution began – to eight seconds. Goldfish, meanwhile, are believed to have an attention span of nine seconds. Delivering data assets in the future will be all about bringing it back to the precise point of the consumer’s need.