Part 3: 10 Big Ideas to Turn Insurance Data into Value in 2022

Big Idea #3: Use Insurer IT Staff Resources Wisely

By Thomas Chesbrough

Burnout, incomplete projects, projects that take longer than anticipated, and employee turnover are major trends that are impacting industries since the pandemic began. These points have been made repeatedly since 2020 through various mediums and surveys. Information technology is one of the fields that likely had an advantage in some ways over other industries in terms of adjusting to remote work due to onshore and offshore resource operating models. However, this does not mean that these resources are being leveraged wisely.

Within the insurance industry, carriers of any size are often tapped for IT resources to manage legacy hardware and software while trying to strategically determine where and how best to leverage emerging technologies. Throughout my 40-year career, I have observed this trend playing itself out as the most senior technology team members feel that it is in the carrier’s best interest to assign themselves to new projects instead of less senior specialized resources. In the past, this translated to the problems that I opened this article with.

However, with rapidly changing consumer expectations, economic pressures, and the uncertainty that the pandemic has brought into business and consumer life this type of approach is causing much more harm than it has in the past. Couple this with the fact that millions of workers have been resigning in mass this year in what is known as the Big Quit or Big Resignation, and this legacy approach to IT management can have perilous impacts on insurer growth.

The Big Quit has implications on both sides for insurers. First, the top talent that carriers are overworking with tactical and strategic projects are likely looking for a company that values their senior expertise more. The other side is for the overworked more junior IT resources that are busy dealing with increased amounts of helpdesk tickets with remote work, they likely have low morale or lack of a sense of possible advancement due to new projects that are disproportionately owned at the highest levels. Numerous IT publications have been writing about this latter trend since the pandemic began, here is an example in this ComputerWeekly article noting a 35% increase in helpdesk tickets monthly since COVID per a survey conducted by DeepCoding.

Insurers or any company for that matter should consider that before the remote work boom getting help from IT was more systematic and slower since there was more face-to-face interaction between co-workers, partners, customers, and other constituencies. These in-person interactions were more preferable to a virtual meeting in most cases when possible. However, for many, part or all of their day now is solely dependent on ensuring flawless ICT performance. Yes, there are many benefits to being able to work remotely from any corner of the world and for employers to find the best talent without being hampered by regional search limitations. Nevertheless, what cannot be lost as we make these advancements are the people that help keep these technologies running smoothly.

In our experience in working with carriers the most successful insurers that have been able to derive meaningful value from their big data have been those that truly dedicate focused resources where they have minimal disruption from other priorities. This has consistently delivered tremendous benefits immediately by saving time and money on implementations, and in the long-term by being able to use BI to identify new products, pricing improvements, or better risk management practices.

For insurers that are curious about how to implement insurance-centric BI efficiently and correctly, Cloverleaf’s experience shows that the IT employee needs to be familiar with the carrier source system data structure. Additionally, this person or team should understand the meaning of insurance terms such as paid loss, reserve, direct premium, and many others. Lastly, they should be proficient with SQL to query data and collaborate on connecting or extracting data from source databases which eases information transfer into Cloverleaf. From our experience, an insurance data engineer or an insurance analyst make the best project managers for our implementations.

To get the most value out of insurance data in 2022, insurers need to give the more junior or specialized IT staff a chance instead of using senior IT leaders that are spread thin by other strategic priorities and other unexpected IT issues that always come up. If insurers want to be known for being forward-thinking innovative businesses, the shiny new technologies that they purchase or reference in press releases are not enough. There must be concrete action to advance the people that can make insurance-centric BI a reality in weeks and not months or years. After all, insurance is an industry that is focused on improving people’s lives. How hypocritical would it be if some carriers are racing for the latest and greatest new technology to improve the insured’s lives while running their internal IT department to the ground?