Insurance carriers have always considered data the lifeblood of their business. In today’s data-driven economy, meaningful data needs to be captured, distilled and interpreted in nanoseconds for insurers to stay ahead of their closest competitors. This means that carriers must have the ability to process high-volume, raw data into meaningful nuggets, such as scores, factors and indicators. This way, they can then integrate and use that data from a constantly expanding variety of sources in a centralized system capable of translating it all into product development, underwriting and claims value. IoT-based systems will play a huge role in the digital transformation of the insurance industry.
The Internet of Things (IoT) is changing the nature of risk assessment in real time. As more and more devices begin transmitting information about their locations, movements and patterns of use, a wealth of data is accumulating about the environmental and human factors that contribute to the likelihood of a loss event taking place. It’s an embarrassment of riches from an actuarial standpoint, but the data is proliferating so rapidly, and from so many sources, that one could be forgiven for feeling overwhelmed by the challenge of putting it all to good use.