This feature is by Tara Kelly, Founder, President and CEO, SPLICE Software and it takes a look at how essential it is to triage the data from major events.
Approximately $145 billion in damage was accumulated in 2021 as a result of 20 weather-related catastrophic events in the U.S. In Europe, damage totals for the catastrophic floods last summer topped £33 billion, while in China’s Henan Province and Canada’s British Columbia, flood damage totals reached £13.3 billion and £5.6 billion respectively. In 2022, carriers are bracing for another year where the damage toll of catastrophic events could set even higher records.
Over the past several years, as insurance carriers have pursued digital transformation strategies to help them operate more efficiently and improve the customer experience, insurers have also applied data in new and innovative ways to decrease costs and increase engagement with policyholders. The use of data-generating technologies like telematics and climate data (such as flood maps) enables carriers to be more proactive about managing risk and improving underwriting practices.
Carriers have adopted more advanced communication practices too, including automated outreach across multiple channels to engage customers where they are. The ability to engage with customers when they need support the most, i.e., before, during and after a catastrophic event, and offer vital data and support, is already a top priority. By sharing data across business units and distributing more personalized claim notifications to customers, insurers can up-level their catastrophic event communication.
Timely and Complete Data Sharing
Business units within insurance companies often pursue digital transformation along parallel tracks to reach the goals they’ve identified for their group. On the underwriting and risk management side, the goal is to get a clearer picture of risk, adjudicate claims accurately and detect fraud. While carriers are beginning to integrate advanced climate data, localized weather information and public utilities data into their risk and claims adjustment processes to drill down to the policyholder level, there is still work to do to ensure accurate and timely data is being shared across all departments.
At many companies, data isn’t shared but instead siloed by certain departments. This must change if carriers want to apply their data in an effective and timely way. Consider the case of advanced flood mapping technology and public data on waterflow in taps and valves: It’s already used to determine risk levels and detect fraud. Imagine if carriers could use this data to inform policyholders before a catastrophic event hits and provide some peace of mind that assistance will be available when the need is greatest. Not to mention, this information can also help expedite claims that need it most after the fact.
Some of the data that’s available now is transformative. For example, persistent monitoring based on technology like Synthetic Aperture Radar (SAR) available from companies like Finland-based ICEYE lets users access data anywhere on the planet, regardless of weather conditions. Advanced technology like SAR can heighten situational awareness of potentially catastrophic events like floods, and, even more important, can do so in near real time. Mother Nature remains an unpredictable beast, but with this technology available, carriers can still show up for their policyholders by being as knowledgeable as possible.
Catastrophic Event Notifications Must Grab Attention
Sharing more data across departments is one step carriers can take to achieve higher levels of trust and loyalty with customers. Using it to craft specific, highly targeted messaging for policyholders takes this to another level. There’s plenty of evidence that customers are willing to exchange more data with carriers if they receive something they value in return. The success of telematics is proof of how that works — subscribers can consent to share behavioral data in exchange for lower rates.
When data is broadly shared within carrier organizations, applying advanced data for catastrophic event communication can provide policyholders with crucial information before, during and after a catastrophic event hits. For example, application of real-time flood data could enable automated alerts to policyholders in danger zones, helping people stay safe and avoid losses. With detailed, near-real time data, carriers can also fast-track claims adjudication for subscribers in zones with catastrophic losses to better help policyholders through a difficult time.
Another factor carrier organizations shouldn’t skip over is that catastrophic event alerts shouldn’t look like every other communication alert from the carrier, such as renewal reminders. Alerts should get people’s attention and convey value in the form of highly targeted information intended to keep policyholders out of harm’s way and limit their losses. These alerts should be as personalized as possible based on the data available around a catastrophic event. Obtaining policyholder consent and communicating with them on their preferred channels to deliver this vital information can save time and money for both parties.
Pre- and Post-Catastrophic Event Communication
Most carriers partner with weather data services, using forecasts to trigger alerts before disaster strikes. It’s a good practice that can keep policyholders informed about the danger of approaching storms, potential wildfires, flooding, etc. In pre-catastrophic event communication, carriers can deliver additional value by using hyper-local forecasts to pinpoint areas that are most at risk and provide specific information to help subscribers avoid any major losses. Carriers should meet their policyholders where they’re at to manage expectations on how the claims management team is going to show up and offer support. With a catastrophic event on the horizon, overcommunication of data and support is key before, during and after the event hits.
It’s also a great idea to share the company’s plans in the aftermath. For example, if a hurricane is expected, the alerts should include information on where the company intends to establish field support operations, a timeline to expect a visit from an adjuster, etc. The more access the communications team has to timely, accurate and specific data, the more proactive they can be in their outreach before and after an event — and the more value they can deliver to policyholders.
Scale up Data Application as Appropriate
Another thing to keep in mind when considering integration of advanced data sources like SARs and automated communication technology is that experienced vendors who understand the insurance industry can help support outreach during the catastrophic events claims cycle. Busy insurance company employees won’t have to drastically change their business processes to take advantage of new sources of data, and customer outreach leveraging the data can be automated to reach subscribers across multiple channels in a secure, compliant way.
Also remember that while more carriers are partnering with vendors to access advanced solutions and enable greater use of data in business processes and customer communication, carriers can incorporate data into their procedures and outreach at their own pace. It’s like investing in an app or device that has many different modules or advanced capabilities and scaling up use cases as the need arises. And as climate issues proliferate around the world, these needs are rising quickly.
For carriers, the demand to distribute vital data and engage with clients before, during and after catastrophic events is already here and increasing, but companies don’t have to deploy every tool available at the same time. Having scalable tools and communication assets in place and being strategic about messaging can future-proof the business. Sharing this data does too. These tactics can help carriers reach their policyholders when and where they need them most, but it can also help them fulfill the core of their mission, which is to help people weather what comes next.
Tara Kelly is the founder, president and CEO of SPLICE Software, which offers a cloud-based solution that specializes in using big data and artificial intelligence, through the scalability of cloud storage and secure API connections, to create messages that drive customer engagement and the desired call to action.