Insurance is a business with as many stats as baseball. We don't make products, we make promises. Those promises are recorded and stored as electronic data. In a very real and important sense insurance is a data-based "industry."

And yet, until recent years, many carriers ran with minimal information about the effectiveness of their various business operations—underwriting, customer service, distribution or claim handling. Indeed, companies struggled to produce basic financial reports, accurately estimate their claim liabilities or state their reinsurance recoverables. The reasons for this sad state of affairs were several and included operational core systems with inadequate data stores, multiple operational core systems with differing data meanings that were difficult to reconcile and balance, multiple manual steps where data would be transferred and manipulated (often with errors), and an almost complete lack of reporting and analytical data storage and reporting.

Two major trends in insurance IT are transforming this picture. First, as we have discussed at length in this column, there is a sustained movement across the industry to modernize core systems, often replacing aged systems that have brittle and restricted data stores with modern, flexible systems that store more information and are better able to integrate data across platforms and systems.