Most people think the insurance business is all about coverage, but these days, it’s really all about data. Every decision insurance carriers make—from deciding what to insure, to determining what to charge for it, to knowing how large an increase policyholders will accept before moving on—is rooted in analyzing the huge volumes of data the companies have acquired. Local insurance agents depend on sophisticated CRM systems to access customer data so they can improve service and their ability to cross-sell other products.
If you work in (or with) the insurance company, it would be wise to develop a familiarity with what cloud storage and capabilities can do to help companies, whether that’s the carriers themselves, local agents, brokers, third-party administrators, or any of the other businesses that power the industry.
The first advantage of using the cloud is the ability to store an essentially limitless amount of data through a single system. Instead of adding roomfuls of server racks to their offices, insurance companies can access everything through a single cloud provider. Now of course that provider may physically store that data across many separate devices, but to the user, it’s all seamless.
Not only does having the data available from one source simplify access, but it also means data analysis can be more thorough and accurate. If the underwriting team wants to get a clearer understanding of something like claims history for a particular type of insured, that information is easy to gather. Better analysis makes it easier to determine optimal premium rates.
Easier to use
What good is having all that data if you don’t do anything with it? With the right software, insurance companies and sellers can do a better job of customizing product offerings and offering features consumers want. Spoiled by folks like Amazon, today’s consumers expect a lot, and if you don’t live up to their expectations, they’ll find a competitor who will.
Cloud conversations always seem to begin around money, and less of it. A few minutes of Googling will reveal plenty of evidence of how much companies saved by migrating their businesses into the cloud. Beyond the lower amounts, there may be other benefits. For example, when you have to buy more computers and servers to keep up with business, you’re making a capital expenditure—and what you’re buying may have a depressingly short service life. What you spend with a cloud provider may be considered an expense for income tax purposes, so not only will it cost you less and avoid tying up working capital, it might even reduce your company’s overall tax liability.
This year, you’re serving 50,000 insureds. If you boost your business by 20 percent next year, will your infrastructure be able to accommodate 10,000 more? The cloud’s architecture is inherently scalable, so even if your business doubles next year, you’ll be ready for it.
If a company in the insurance sector is thinking about upgrading its technology, in addition to worrying about the complexities of replacing each device, they also have to consider what they’ll do with the data on those devices. Even if much of their data is stored in a central location, individual computers may house files that aren’t available elsewhere. By moving every bit of the company’s data to the cloud, changing devices becomes much easier. That allows the company to be more agile.
There are risks
Insurance professional are experts on strategies for mitigating risk, so they need to be cognizant of the risks associated with a move to the cloud. Depending upon the nature of your business and your data, that may include risks related to regulators, compliance with laws, and the human factor.
Ready to put all the benefits of the cloud to work for your organization? Call our Cloudologists to learn how implementing cloud-based technologies can improve your company’s bottom line. Our philosophy is simple: when you allow us to do what we do best, it allows you to efficiently and affordably do all the things that you do best.