Risk & Analytics

New legs for the proposal form

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I had the pleasure of recently presenting on the topic of analytics to a group of geographers . It wasn’t so much about mapping, but rather about the power of geo-intelligence in insurance and how the topic of ‘location’ is infused across all parts of the insurance industry. My call to action for them was that ‘location’ is now part of the Big Data story, and it was about time that geographers came out of the closet.

One attendee made the point that they could already provide 19 key information points about the physical risk to a property – location, type of construction, environment, flood risk etc – which dramatically reduces the need for insurers to ask questions. What they couldn’t do was provide information on the policyholder themselves – although they could use demographics to give an indication on probable lifestyle.

The recent tie up between AXA and Facebook seems to fill in some of the gaps. , using social media to gain insight into the customer. Facebook has 1 billion users – of which 9% or 83 miilion, are fake , a number which coincidently is about the same size of AXA’s customer base

In an earlier blog about this time last year, I asked whether the proposal form is on its last legs.  At the very least, all this available informaton might allow insurers to ask cute and maybe more testing questions, like ‘how often do you hold parties?

Having all this information seems like a useful thing at face value, but isn’t there another side of the coin? In this Big Data environment insurers may soon have access to sufficient information about the risk that non-disclosure as a defence to policy liability might come to be a thing of the past.

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