By Tony Van Niekerk, Editor at COVER Magazine
In a recent conversation with Sharon Paterson, CEO of Infiniti Insurance, and Angus Black, director at BarnOwl Data Solutions, we explored the issue of data sharing between insurers and brokers.
This discussion highlighted the importance of efficient data management for regulatory compliance, business operations, and the mutual benefits it offers to both insurers and brokers.
Understanding the Importance of Data Sharing
To kick off our discussion, Sharon provided insight into the regulatory responsibilities of insurers to share and obtain data from brokers. “There is a regulatory responsibility on insurers to have at least daily dumps of data and full immediate access to data regarding their clients,” she explained. This data is crucial for meeting regulatory requirements and integral to the daily operations of the business. For instance, during recent heavy rains, Infiniti Insurance utilised daily claims reports to monitor potential catastrophes and advise reinsurers accordingly.
The data received from brokers and underwriting management agencies (UMAs) is used to provide feedback to partnerson their own books of business. This feedback helps brokers identify multi-claimant clients and adjust premiums accordingly, ensuring that they charge the right rates based on clients’ claims histories.
Challenges in Data Integration
However, integrating data from various brokers presents some challenges. Sharon highlighted the difficulty of receiving data in different formats from different systems. “To really use your data effectively, you need it in one format on one database,” she noted. Without this uniformity, comparing data becomes a very manual exercise. Infiniti Insurance overcame this challenge from its inception by standardisng the data received, which has been crucial for their operations.
Angus elaborated on this issue, explaining BarnOwl Data Solutions’ role in collecting and cleansing data for insurers “We started our journey with insurance companies, brokers, and underwriting managers in 2008,” he said. BarnOwl has built relationships with 34 different insurance management systems to ensure that data is collected, cleansed, and presented in a usable format for reporting and operational purposes.
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Benefits of Efficient Data Management
Efficient data management offers numerous benefits for brokers. As Sharon pointed out, a well-structured data process helps in generating reports for both underwriting and reinsurance, and thus protecting insurers against unreinsured claims. Moreover, by utilsing a data warehouse, Infiniti Insurance provides brokers with monthly reports showing changes in rates and sums insured. This allows brokers to adjust their pricing accurately and ensure they are not overcharging or undercharging clients.
One significant benefit is the ability to benchmark rates across different regions. For instance, if a client relocates from Johannesburg to East London, brokers can use the data to understand the appropriate motor rates for the new location. This benchmarking helps brokers avoid charging incorrect rates, which could lead to adverse loss ratios or dissatisfied clients.
Overcoming Data Challenges
The conversation also touched on the common challenges brokers face in managing data. Angus mentioned issues like varying data formats from different systems, data quality, and technical challenges such as those posed by load shedding in South Africa. BarnOwl Data Solutions has implemented extensive validation checks to ensure the accuracy and reliability of the data. They also work closely with brokers’ service providers to resolve technical issues and ensure timely data delivery.
Collaboration and Cooperation
In closing, Sharon emphasised the importance of collaboration between insurers and brokers. In her experience our brokers give their full support because they recognise the benefits of accurate data. “The more we can extract from our data, the less we need to ask of our brokers,” Sharon said, highlighting how this efficiency allows brokers to focus more on client interactions and less on administrative tasks.
Our discussion underscored the transformative impact of technology on the insurance industry. Efficient data sharing and data management not only meet regulatory requirements but also enhance business operations and foster better relationships between insurers and brokers. As technology evolves, managing these systems should not detract from the core business of insurance. Instead, leveraging the expertise of data solutions providers like BarnOwl can streamline processes and improve service delivery across the industry.
Thank you, Sharon and Angus, for sharing your insights. I am sure this information will be invaluable to brokers seeking to optimise their data processes and enhance their relationships with insurers.