Bad data…I feel your pain. But there is light at the end of the seemingly dark tunnel…
Having worked with countless insurance companies over the years, I am pleased to assuringly inform you that the future of MI is a lot less daunting and time consuming as you all may think! Here are a few insights which I have gained as to why I believe this to be…
Sounds obvious, but I what I have repeatedly witnessed in some of the larger MGAs and Brokers, that too many processes are dependent on skilled resources being there at “MI time” and running things “manually”. These tasks range from updating databases to updating extracts for a BI tool to consume or simply going to get the base data for MI from an external server in the first place. Not only is dependency here the massive risk, but the simple realisation that if Mr/Mrs/Miss MI is not here, the company has no meaningful information at all that month!
Resource Utilisation – Risk v Reward
Underwriters are the life blood and revenue source of many insurance organizations, so they must be underwriting 90-100% of the time – right? Wrong ! In many cases these skilled resources seem either intent on becoming or are simply forced to become, Excel “gurus” who spend up to 50% of their time massaging data for MI purposes (all too often incorrectly !). That’s a very poor return on a very valuable asset.
Bad / Erroneous Data
Every industry has bad data, but Insurance has a much higher proportion of erroneous information which always ends up distorting your business’s true performance and MI. It has been well documented that in one MGA, we had to reject 24% of all policy / claim data which did not conform to the most basic of tests for validation an integrity. With Electronic Data Interchange (EDI) being now used on a widespread basis, seemingly “daft data” arises where items such as claims exist before a policy has even started !! Industry research suggests this problem is rife, but it must be overcome once again, in a fully automated manner.
I appreciate that every company has its own data issues, which is why I am continuously striving to learn more about what issues and challenges insurance companies are experiencing with their MI, and would love to hear from you on the matter.