Analytics, data, digital channels, modern applications andinnovative business practices are driving advanced capabilities inthe insurance industry, according to a survey of more than 60 P&C insurer members ofthe Novarica Insurance Technology Research Council aboutcurrent and planned deployments.

The study also found that larger carriers are widening theirlead in these advanced capabilities, with the most work being donein underwriting, analytics and the areas of billing anddistribution with direct customer impact. Larger carriers aredefined as those with premiums above $1 billion.

On the opposite side of the spectrum, advanced uses of mobileand analytics technology in the insurance industry are still rare.However, a handful of surveyed insurers have deployed capabilitiesin those areas. 

Analytics-driven product design and products optimized for thebuying/selling experience are positioned for the most dramaticincreases in 2015, Novarica reports. About half of the carriers dothis today, and another 25% are planning to launch thesecapabilities this year.

Here, Novarica details a list of 50 advanced capabilities thatinsurers are delivering "using leading-edge technology, but notbleeding-edge technology."

Product Development

As far as deployment, analytics-driven product design, retentionmodeling as part of rate design and products designed to optimizethe buying/selling experience through pre-fill data or streamlinedunderwriting processes are most common, with about one-fifth ofrespondents indicating that they widely use each.

Less widely used are centralized product modeling systems thatfeeds all relevant downstream systems machine-learning toimprove rating algorithms.

Marketing

Insurers are beginning to use CRM-driven campaign managementthat shares information across distribution, underwriting andservice channels, and the use of these capabilities will expand in2015 as 21% of respondents plan to integrate this technology. Thesame holds for responsive social media engagement withdistributors and policyholders.

Larger insurers are significantly more likely than midsizecarriers to have CRM-driven campaigns integrated across othersystems, Novarica reports. However, midsize insurers do not fallbehind larger companies in their deployment of analytic customersegmentation.

Distribution

Whether insurers distribute directly or through intermediaries,data and digital channels provide streamlined service. Half ofinsurers are using pre-fill data, which may assist with quick quoteor appetite indication and support e-signatures for paperlesstransactions.

Other capabilities in this area include online social mediamarketing for distribution partners, analytics-driven distributionnetwork optimization, and mobile apps or mobile-optimizedwebsites. 

Midsize carriers are more likely to provide online and socialmedia marketing support to their agents. 

Underwriting

Increased accessibility of data and improved capabilities ofanalytics are transforming underwriting, as less time is now spenton assembling information and making decisions, and more timeworking with larger volumes of data and interpreting results.

Novarica's research found that all large insurers in its samplehave already deployed predictive scoring or are likely to withinthe next year.

Customer Service

This area has been transformed as customers expect richinformation, transactional capabilities and interaction withsupport services in real time. Current deployment rates ofonline recommendations and online chart are low across allcarriers, but large insurers are more likely to deploy these in2015.

Insurers also are using same-day e-mail response, 360-degreerelationship views via portal, mobile apps to view relationshipdetails, and analytics-driven engagement to improveretention. 

Billing

Advanced capabilities in this category include consolidatedbilling across all product lines, e-payments, support for majorelectronic payment types, policyholder-customizable billing plansand analytics to prevent premium leakage.

Within its survey group, Novarica found that more than 70% oflarge and midsize insurers support e-payments, and that both groupshave comparable rates of providing consolidated billing.

Midsize insurers are slightly more likely to providecustomizable billing plans. 

Claims

Similar to underwriting, carriers are deploying triagedstraight-through processing and skills-based routing of incomingcases. They are using direct channels to create paperless processesfor claimants and are providing video/GPS data capture and mobilefield adjuster apps. 

Within the surveyed group, Novarica reports that large insurers'deployment rates are significantly higher than those of midsizeinsurers in all claim areas.

Analytics

The use of big data tools to mine information is emerging, asinsurers realize the challenges of consolidating and interpretingfragmented enterprise data.

Possibly related to this trend, more insurers are now staffingtheir analytics departments with employees who have earned Ph.Ds.in statistics, the report says.

Survey-wide, the use of analytics to drive decisions throughoutcompany leadership and the use of user-friendly reports forbusiness execs are among the capabilities most widely used in anycategory.

Collaboration and innovation

Capabilities in this area include: formal innovation programs,executive performance incentives, enterprise crowdsourcing forinnovation ideas, internal social media, and enterprisecollaboration.

A quarter of large insurers has executive compensation linked toinnovation, more than double the rate of midsize insurers, Novaricastates.