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Market Regulation
Regulator and Industry Hot Topics
Disclaimer
The views and opinions expressed in this
presentation do not necessarily reflect those
of the National Association of Insurance
Commissioners (NAIC) or the National
Insurance Producer Registry (NIPR).
Panelists
Lisa Brown, JD, MCM
Sr. Counsel & Director, Compliance Resources
American Insurance Association
Beth Lovaas
Regulatory Advisor
Texas Department of Insurance
Angela Nelson
Director of Market Regulation
Missouri Department of Insurance, Financial
Institutions, & Professional Registration
The Data of Things
• 71% of insurers plan to boost IT spending in
2015, with 76% expecting to do so from 2016
to 2018
• Project spending aligning to…gain more insights
through business intelligence and analytics
• From 2014 to 2015, analytics usage in modeling
increased nearly a third.
The Data of Things
How data is changing the insurance
industry today and tomorrow
and the ramifications to
Underwriting, Claims and Fraud
The Data of Things - Underwriting
• New, massive amounts of data: Sensor, internet of
things, texts, social media, customer background,
structured and unstructured, real-time
• Enhance underwriting decisions with automated
rules system, decrease unit cost per application,
decrease cycle time, increase consistency of
decisions, reduce uncertainty
• Predictive analytics to evaluate individual cases,
identify trends, define pricing and loss control
models, track risk as changes over time
The Data of Things - Underwriting P&C
• Combine hyper-local and aggregated weather
data to predict risk and loss for crops
• Prefill customer data in application, customer
confirms data, and creates quote for auto
• Use of telematics to monitor individual driving
habits (usage-based)
• Use of drones for risk assessment, risk
management, and loss control
• Building and contents valuation estimates
integrated with weather forensics
The Data of Things - Underwriting L&H
• Collect demographic data from customer and
query the data against medical data sources
• Monitor behavior and medical data via fitness
tracker for disability, term and universal life
• Attributes that will define next generation of
life insurers in five years: digital, customercentric, efficient, data driven, technology
empowered
The Data of Things - Concerns
• Transmission, storage, and reporting of
private data and rating factors
• Interpretation of data
• If rates become individualized, are they
still adequate, not excessive, and not
unfairly discriminatory?
• Adverse selection
The Data of Things - Claims
• Traditional claims data warehouses
• Comprehensive Loss Underwriting Exchange (CLUE)
• Automated Property Loss Underwriting System
(A-Plus)
• Basic claims tools
• Advanced claims analytic software
The Data of Things - Fraud
• Identification of fraud
• Social media angle
• Data analysis to identify red flags
• Largely based on financial information
• Predictions of fraud
• Data analysis to predict who is likely to
commit fraud
• Also based on financial information
The Data of Things - Concerns
• Heightened regulatory concerns about
“mission creep”
• Striking the right balance of efficiency and
innovation with public policy
• Maintaining the human element
• Transparency and disclosure
• Regulator engagement
Contact Information
Lisa Brown
202-828-7104
[email protected]
Beth Lovaas
512-676-6362
[email protected]
Angela Nelson
573-751-2430
[email protected]
Citations
Slide 4.
•
2015, March 3. Insurance IT Investment Will Grow in 2015, With Large Carriers Leading.
http://www.carriermanagement.com/news/2015/03/03/136245.htm
•
2015, March 6. 10 key statistics around social media, mobile, analytics, big data, cloud and digital technologies for insurance.
http://www.propertycasualty360.com/2015/03/06/10-key-statistics-around-social-media-mobile-analy.
Slide 6
•
2015, February 19. Underwriting: Where Insurance Data Really Pays Off.
http://www.insurancenetworking.com/news/data_management/underwriting-where-insurance-data-really-pays-off-35565-1.html
•
2015, April 13. 5 Ways Digital Data Can Benefit Your Business. http://www.propertycasualty360.com/2015/04/13/5-ways-digital-datacan-benefit-your-business
•
2015, April 13. 5 Ways Digital Data Can Benefit Your Business. http://www.propertycasualty360.com/2015/04/13/5-ways-digital-datacan-benefit-your-business
Slide 7
•
2015, April 13. How Big Data Helps MetLife and Lincoln Financial Sell Insurance Faster.
http://www.insurancenetworking.com/news/feature/how-big-data-helps-metlife-and-lincoln-financial-sell-insurance-faster-357641.html?pg=1
•
2015, April 7. Switching to Usage-Based Car Insurance Might Save You Money.
http://www.nerdwallet.com/blog/insurance/2015/04/07/usage-based-car-insurance/
•
2015, March 18. CoreLogic Releases Property Risk Assessment Platform.
http://www.insurancejournal.com/news/national/2015/03/18/360981.htm.
Slide 8
•
2015, April 13. How Big Data Helps MetLife and Lincoln Financial Sell Insurance Faster.
http://www.insurancenetworking.com/news/feature/how-big-data-helps-metlife-and-lincoln-financial-sell-insurance-faster-357641.html?pg=1
•
2015, April 8. Giving Out Private Data for Discount in Insurance. http://www.nytimes.com/2015/04/08/your-money/giving-out-privatedata-for-discount-in-insurance.html?_r=0
•
2015, April 16. Life Insurers Bet on Tech to Entice Customers. http://www.insurancenetworking.com/news/news/life-insurers-bet-ontech-to-entice-customers-35788-1.html?utm_campaign=dailyapr%2016%202015&utm_medium=email&utm_source=newsletter&ET=insurancenetworking%3Ae4200077%3A1333315a%3A&st=ema
il.
Slide 9
•
2015, April 13. 5 Ways Digital Data Can Benefit Your Business. http://www.propertycasualty360.com/2015/04/13/5-ways-digital-datacan-benefit-your-business