Editor's Note: Mike Kulp is head of Sales for Xuber and head of Xuber, US.

Analytics shouldn't be called analytics. Way too geeky and boring for one of the biggest revolutions in the business world.

Regardless of what it's called, though, analytics is going to change the way we live and work forever. Yet while some large insurance players are starting to get their heads around it, for others there still seems to be a mist surrounding the practical application and benefits of taking the analytics journey. In other words, beyond the glossy brochures and hype, how are analytics applied in the real world, and what do insurers stand to gain?

So here are some practical scenarios of analytics in action. But before we proceed, be under no illusion that a purchase order for the latest analytics software is going to be your panacea. Far from it. Sadly, there aren't any shortcuts with shiny new analytics software because it is – in essence – only an empty shell that requires a foundation of accurate data. To have a chance at success, you'll need to get your data in order — understanding its location, quality and accessibility — which will require some investment in time and resources.

Now that we've done our reality check, let's get down and dirty with analytics and take a look at how it's being applied to deliver tangible benefits on the street.

Application 1: Slice and Dice

Your boss spots an abnormally high loss ratio in your team's first quarter figures. He's on your case to find out why by tomorrow morning. You've got a feeling it has something to do with the construction sector, but you need to find the proof.

Before analytics:

You send an email to your team leaders asking them for an indication of performance, but they struggle to get IT to provide them with the information they need because the data available just isn't granular enough.

With analytics:

Using your online analytics tool, you check underwriting year analysis and filter reports to confirm your suspicions. You filter further, by sub-class, territory and broker and pinpoint a specific contractor in France. You take action, and respond back to your boss in less than half an hour.

Application 2: Unifying disparate data sources

You've got a board meeting in 48 hours. You've just been tasked with investigating the spread of risk across your international operations. But your U.S. team uses a different brand of insurance software than your London branch, while yet another is being used by the newly acquired firm in France.

Before analytics:

Sadly, the data you need is in different formats, sources and locations. You sigh and manually request and collate the data from IT. When it finally arrives you spend hours trying to make apples to oranges comparisons, but your findings are inconsistent and already out of date.

With analytics:

By accurately correlating data from the three sources together, and analyzing the whole picture, you collate the reports you need and compare total exposure by region in minutes via an online analytics tool. You enter the board room with unified data intelligence and deliver an accurate 'big picture' viewpoint.

Application 3: Managing global business units in multiple currencies

You need to handle an important claim that involves risk spread across the Middle East, the US, France and London, but they all use different currencies and different languages. Your customer needs an answer by this afternoon.

Before analytics:

Language barriers make it time-consuming to gather the information you need to process the claim, and cross-border currency variances cause multiple discrepancies when you finally get the information. Your customer has to wait until the next day.

With analytics:

Using your online analytics tool, you access the necessary information via your browser. You select a base currency, and prepare the required analysis for the claim in under an hour.

Application 4: Analyzing trends and asking 'what if?'

Monday morning, you're reviewing your figures. You spot an unusually high loss ratio developing in a recent underwriting year, and you want to find out how will it pan out.

Before analytics:

Any planning and trending you attempt is going to be educated guesswork, but you need to be seen as taking action. You ask a few colleagues what they think might happen.

With analytics:

Using historical trend data, you model the future of the loss ratio that is likely to develop. Early signs indicate an unfavorable pattern, so you track potential poor performance to a group of small commercial property claims. You change the model and see what effect a higher excess point would have. Your predicted loss ratio improves, so you recommend a higher excess at renewal.

Application 5: Analyzing performance

You're planning for a review meeting with the head of underwriting, where you need to discuss the last quarter's poor performance. Several tactical actions are on your mind, including monitoring a specific COB in a particular region. But you need facts to back up your ideas.

Before analytics:

You ask your IT colleague to generate a performance report for the COB. It still doesn't give you the answer, because you need to drill down further. You ask for another report. Another day passes. “It's going to take a while,” they say. Your boss gets frustrated, and so do you.

With analytics:

Studying an online dashboard item showing GWP by Line of Business for the last 12 months, you identify a drop in performance from a specific broker. You investigate further and highlight operational inefficiencies. You share your findings with the relevant team leader by alerting them online through your analytics tool. Then they focus on internal team operations to improve productivity, profitability and performance of the broker.

Application 6: Using analytics for strategic planning

You're a CIO. You've got a board meeting next week where the C-suite is going to undertake a strategic review of operations, with a view to planning for the next three years.

Before analytics:

Everyone brings different reports to the meeting. Comparing reports is challenging, as some include new subsidiaries and some don't. Some data presented is a month old, and some even older. Plans to cut back or expand are based on gut feel more than anything else.

With analytics:

Using the interactive analytics tool, you and your C-suite colleagues interrogate, model, adjust and share findings using granular and dynamic business intelligence to make better informed decisions.

The bottom line

Analytics brings together a firm's two greatest assets – information and people – creating a fluidity of empowerment, collaboration and action that just isn't possible with rigid paper-based reports.

Deploying analytics is not an overnight checklist exercise by any means. But as these examples show – the rewards of analytics are evident, giving firms the ability to understand so much more about themselves and their customers, bringing agility and, above all, competitive advantage.

And as for the new name for analytics… we prefer how-are-you-going-to-do-without-ics, but even if the name doesn't catch on, one thing is for sure – the technology certainly will.

Special Reports /

6 Scenarios Made Easier with Analytics

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