Insurance has always been about risk transfer driven by data and analytics. Insurers were conducting in-depth analyses long before computers or big data. And, much to the same degree, insurance has also always been about trust, risk mitigation and protection. But over the past decade, the relationship between data, analytics and trust has changed, posing significant opportunities and challenges for the incumbents in the insurance sector.
The rise of smart, connected devices, the internet of things (IoT), well-funded InsurTech start-ups and sophisticated data and analytics is disrupting the industry. The flood of new data is allowing insurers to track how insured ‘things’ move through the risk universe.
This article explores the changing ‘trust’ relationship traditional insurers have with their customers as InsurTech players and the internet of things bring new and disruptive change and opportunity. From the complexity of insurance ecosystems to the effective application of machine learning and the trade-offs of greater transparency, the article offers practical considerations for insurers as they attend to trust in their analytics.
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