For the past few years, large insurers have been using big data and analytics to help set customer rates, to better identify risks and fraud, and even to make the claims process easier. Today more insurers are increasingly turning to big data throughout the customer life cycle.
Faced with massive amounts of unstructured data, insurers are using the data they have to uncover useful insights about their customers, according to an article in Insurance & Technology.
However, even though insurers are investing in analytics across the entire customer engagement process, many of them aren’t spending on an area that could help increase profit – customer acquisition.
With new advertising technology that’s driven by analytics, insurers can develop their digital marketing strategies more cost-effectively, according to the article.
“By combining first-party, third-party, and proprietary data, insurers are given the best possible view of a prospect, allowing them to target each consumer’s individual needs and to present them with more competitive quotes, with the objective of converting them,” the article notes.
Insurers can use these platforms to better track their digital ad spending throughout the entire buying and selling process. Big data enables these companies to more easily identify target audiences, track the successes of their marketing campaigns, and change campaigns quickly to target the right prospects and convert them into high-value customers, according to the Insurance & Technology.
Additionally, insurers that use targeted data to acquire customers will be better positioned in the future. For example, auto insurers that analyze customer data through their advertising strategies, can better identify consumers “who are less likely to be a risk to their financial bottom line in the future.”
More specifically, although good drivers won’t pay premiums that are as high as bad drivers, the odds that good drivers will file accident claims are lower, ultimately saving the insurance company, according to the article.
Insurance companies can save money by building on their existing big data strategies to develop digital marketing campaigns targeted to their most valuable customers. Insurers can pass on those savings to customers in the form of lower premiums and better service, helping to increase retention rates.
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