Turning Data Into Information: Business Intelligence In Insurance (Strategic Focus)

Turning Data Into Information: Business Intelligence In Insurance (Strategic Focus) published by Datamonitor in April, 2009. This report consists of 28 pages and the price starts from US $ 3395.

Introduction

Abstract

Introduction

The insurance market is facing short and long-term challenges. In the short-term, weak demand and paltry investment income, plus elevated levels of fraud, will negatively affect profits. Longer-term issues include: the need for robust risk models; new products and distribution channels; and a structure that can effectively comply with regulations. BI tools can help meet these challenges.

Scope of this research

• This report discusses the challenges and opportunities among both life and non-life insurers.
• This report applies to global insurers; however, many of the regulatory issues that are discussed are W. Europe and N. American focused.

Research and analysis highlights

While point solutions are valuable, today' s large insurer managing multiple risks over an expansive geography needs a complete view of the operation. The insurer that is able to garner such a view will be better able to be proactive instead of reactive to changing market conditions.

The combination of market drivers and technology accessibility has heightened small insurers' interest in BI. 62% of insurers with fewer than 1,000 employees are planning to increase their investment into BI. This segment of the market outpaces all of the other segments by a fairly wide margin.

In 2009, spending on BI by non-life and life insurers is expected to slow to 4.4% and 3.9%, respectively, thanks in large part to the global economic environment. By 2010, non-life spending on BI should return to nearly 7% annual growth, while life is expected to register at 5.4%.

Key reasons to purchase this research

• Gain an understanding of the market conditions facing both life and non-life insurers.
• Understand the market size and opportunities for BI in insurance.
• Explore different go-to-market strategies and how they can be deployed to meet the needs of different insurers.

Table of Contents

OVERVIEW

• Catalyst
• Summary

KEY MESSAGES

• Insurers are facing a laundry list of challenges that BI can help mitigate
• A confluence of factors is driving adoption among small insurers
• Meet the needs of the SME market with pre-built offerings and Software as a Service
• An opportunity exists to move large insurers from point solutions to enterprise-wide solutions with rich capabilities
• Spending on BI will slow in 2009, however fraud, risk and compliance will maintain medium-term growth

MARKET OPPORTUNITY

• Insurers are facing a laundry list of challenges that BI can help mitigate
  • Customer intelligence
  • Compliance
  • Enterprise performance management
  • Financial analytics
  • Fraud
  • Risk

• Several pockets of growth exist for BI within the insurance sector
  • Moving large insurers from point solutions to enterprise-wide solutions with rich capabilities
  • A confluence of factors is driving adoption among small insurers
  • Life insurers are becoming increasingly interested in BI

• Spending on BI will slow in 2009, however fraud, risk and compliance will maintain medium-term growth

IMPACT ON THE INSURER

• Democratizing BI can lead to improved performance and can be driven by different pricing strategies
• A shared services strategy enables an enterprise view
• What the vendor consolidation means for insurers

GO TO MARKET

• All-in-one vendors should highlight the value of an end-to-end solution but not neglect to position themselves as stand-alone solutions
• Specialized vendors should remain focused and seek strength through partnerships
• Meet the needs of the SME market with pre-built offerings and Software as a Service
• Vendors preach but do not often practice targeting customers based upon lifetime value
• Recommendations
  • Sell to the business and not to the IT department
  • Continue to improve and highlight mobility features
  • Specialist vendors should innovate with agility
  • Develop enterprise wide deployments one department at a time, if need be
  • Understand your customers' businesses

APPENDIX

• Methodology
• Further reading
• Ask the analyst
• Datamonitor consulting
• Disclaimer

FIGURES

• Figure: BI has a role to play in meeting today' s challenges
• Figure: BI maps onto the key objectives of insurers
• Figure: Current and projected adoption of BI functions, by insurers with 5,000+ employees
• Figure: Outlook for BI investments, broken-down by insurer size
• Figure: Projected BI spending by non-life insurers, 2008 - 2013
• Figure: Projected BI spending by life insurers, 2008 - 2013
• Figure: Shared services framework
• Figure: Current SOA adoption, broken down by sector
• Figure: Software as a Service usage, by employee size

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