Risk managers should embrace data strategies that use real-time data and a single version of the truth in order to make their businesses more resilient.
This was the advice given in a session at the Pan-Asia Risk & Insurance Management Association (PARIMA) virtual conference.
The session, entitled ‘Building resilience with data’, saw three insurers – Swiss Re Corporate Solutions, Descartes Underwriting and FM Global – pitch their data services to risk managers.
For many years, the insurance industry has had a poor reputation when it comes to data provision but thanks to better technology and a realisation of the value of data, this is no longer the case, claimed the insurers.
“As an industry, we could have been accused of being data-rich but tech-poor,” said Jonathan Rake, CEO of Asia-Pacific at Swiss Re Corporate Solutions. “This picture is rapidly changing as more and more players in the risk and insurance industry figure out the value of their own data and the data of others, and how to effectively use them.”
All three argued that the pandemic has highlighted the need for more dynamic data strategies, including the use of real-time data.
“A key learning of the pandemic was that companies did not have enough transparency or data around their supply chains,” said Veng Hoong Loh, digital propositions lead, Swiss Re Corporate Solutions. “How do we make sure we have adequate cover? What might disrupt supply chains in real time rather than using historical loss data?”
A strong data structure using real-time data and technology such as application programming interfaces (APIs), allows risk managers to consume real-time data and “make decisions more quickly and with greater confidence”, said Loh.
The importance of real-time data was echoed by Robert Drysdale, head of southeast Asia at parametric insurance specialist Descartes Underwriting. “Our coverage is based on predefined parameters such as wind speed and earth movements, as opposed to the manual claims adjustment process. So, using real-time data is core to our business.
The use of data has become even more important during the current pandemic, stated Drysdale. For example, Cyclone Harold hit Tonga last year at the height of the pandemic. The use of satellite imagery enabled Descartes to track the wind speed in real time and pay claims without the need for onsite loss adjustment and within days of the storm making landfall.
The increased value of data has generated concerns over the battle for data ownership between insurers, insureds and their intermediaries, and it was a question raised during the panel discussion led by Parima member and risk manager Annacel Nativdad, chief finance officer at Pilmico Foods and risk management head at Aboitz Food Group.
However, Drysdale also stated that parametrics use a lot of open data and are available to everybody, so that puts everyone on the same footing. “If you have the insurers and the insureds both using the same data, that would help,” he said.
This point was emphasised by Tan Hian Hong, vice-president, division underwriting manager, Asia-Pacific, FM Global. “The data that we obtain is grounded in physical truth – GPS coordinates and the size of buildings. What insights you gain from that information is what really matters.”
Sources: www.commercialriskonline.com/insurers-make-pitch-to-risk-managers-for-real-time-data-services