The ongoing digitization of the global economy and industrial practices is changing the nature of risk—disrupting the commercial insurance and reinsurance markets in unprecedented ways.
Organizations are increasingly relying on technology, automation, robotics, and remote-monitoring equipment to increase productivity and cut costs—a concept known as Industry 4.0. It is not just human failure that insurers must insure against; they must also now address unknown risks such as IT failures, cyberattacks, and data breaches.
As a vast amount of historical data is available to sources outside of the traditional insurance industry, both commercial insurers and reinsurers need to make clear sense of new and larger data analytics to better predict and price risk.
BCG can help commercial insurers and reinsurers differentiate themselves within a radically changing market. We combine our deep understanding of insurance underwriting, pricing, and risk with insight into the market and the technology forces disrupting various market sectors to help insurers:
To make the most meaningful business decisions, commercial insurers and reinsurers must know how to tap into large, complex streams of data and effectively apply advanced analytical techniques and algorithms across those streams. This process is known as smart analytics, and it can provide commercial insurers and reinsurers with critical new insights into behavior, probability, and risk.
BCG helps insurers understand how to most effectively use smart analytics by employing tools like our Smart Analytics Diagnostic Framework, which helps identify the right data pools and information gaps, devise and deploy a smart analytics strategy, and run complex and comprehensive analyses. In using such a tool, BCG can help insurers realize: