Here are a few critical elements to keep in mind to achieve a higher level of granularity in risk evaluation and expand the use of third-party data:

1. Prioritize data and tech stack capabilities

Technology is the conduit to third-party data. External data, just like internal data, is only as good as the insight that can be extracted from it. To make data an asset, insurance professionals need to be able to rapidly collect, conform and operationalize it. This requires a modern data platform and API strategy that enables insurance organizations to consume external data, marry it to their own data and drive actionable insights with speed.

2. Have a dedicated resource or partner to hunt for new data

Consider dedicating an in-house resource to the constant search for emerging forms of data (even outside the insurance sector) that could provide a competitive advantage. Hunting, gathering and evaluating is extremely difficult as a side gig and requires constant focus and attention. Alternatively, or in conjunction with in-house resources, look for partners who can help supplement the search and continuously provide a pulse on where the market is going and what competitors are doing. Economies of scale are the most logical way to expand an organization's data footprint.

3. Refine the process for testing and evaluating new sources

The tools for statistical insights are expanding, but data is the blood that keeps it running. Ensure dedicated data teams have a set process and the ability to constantly be testing new data sources that could complement or supplement existing data. Data teams should not only be evaluating incremental predictive power, but also identifying backup data sources for current data assets. Again, look to partners who can help evolve risk models quickly and incorporate fresh characteristics. Knowing about data is a great first step. Putting data into action is where it makes a difference.

4. Think proactive, not reactive

How will factors like climate change, remote workforces, political unrest, self-driving cars and electric vehicles impact your portfolio in a few years from now? What data can be employed now to get ahead of the curve and more effectively price, mitigate, and manage future risk? How can third-party data be used to provide forward-thinking insights into a company's book of business to more effectively balance growth and profitability? As the landscape continues to evolve, keeping pace is vital with the emergence of new competitors.

5. 'Stream' access to third-party data

As with each of the above points, partnering is key to accelerating every aspect of third-party data integration. Tap into partner ecosystems to enable rapid ingestion of third-party data with providers who already have a variety of leading data partnerships established. This avoids having to set up an API for each data relationship in favor of one API that taps into many data providers, including emerging forms of data as they become available.

Special Reports /

The race for data granularity in P&C

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