January 16, 2019
6 Implications of Big Data for Insurance
There are many initiatives in the works that will meet new customer needs and help to solve some of the world’s most important problems.
CES, which once centered on consumers and electronics (per its name), now extends far beyond consumers and focuses much more on software and data than on the electronics and hardware. To be sure, it still all comes together in physical devices, and elements like engineering and design are vitally important. But more and more, everything comes back to the data. In fact, at the opening of CES2019, it was declared that we are in the Age of Data. It is no secret that we are amassing data at practically unbelievable rates from a rapidly expanding array of sources. But what is truly astonishing is what IBM CEO Ginni Rometty termed “deep data” in her keynote – the 99% of the data that the world emits that is not even collected or analyzed today.
It is exceedingly important to explore all the issues and opportunities related to data. The top areas – all with big implications for insurance – are these six:
Capture: Technologies to capture all types of data are advancing rapidly. This includes images, video, audio, text, 3D image capture and motion capture for virtual reality. Increasingly, real- time biometric data and environmental sensing data are being captured, as well.
Transmission: 5G is even more prevalent at CES2019 than it was in 2018. As a so-called “ingredient” technology for the connected world, it will have a vital role due to the data transmission capacity needed, speed and ultra-low latency.
Security: More digital data means more potential exposures. Some data will naturally be in the public domain. But other data will be owned by individuals, businesses or governments that will seek to protect that data from misuse.
Privacy: The ownership of data has become a top-of-mind societal issue. As even more sensitive data gets collected through more devices, the question of data rights becomes complicated. Some companies at CES were promoting “privacy-centric” solutions, which may signal a positive trend.
AI/analytics: “AI is Everywhere” was actually the title of one of the sessions at CES2019. And AI was everywhere on the show floors, as well. Granted, AI represents a large family of technologies ranging from relatively straightforward (robotic process automation) to very complex (machine learning/cognitive computing).
Interaction: New types of interaction abound. Haptic controls continue to expand. Augmented reality in many forms is advancing. Foldable display screens offer new options. Above all, voice interaction is starting to be available all around us.
Of course, what is most important are all the new products, services and insights that will be fueled by data. The vastness of CES2019, with 4,500 exhibitors and tens of thousands of products, is a testament to that. In addition, there are many initiatives in the works that will meet new customer needs and help to solve some of the world’s most important problems.
What this means for insurance is that there will be many new data sources and analytics tools available for risk assessment and risk management, increasing exposure to cyber risk in the world, and new ways to communicate with customers and partners. Just as important will be the ways that data will fuel transformation in every customer segment covered by the insurance industry.