Understanding the Value of Location Intelligence Solutions
Making the Business Case for the Insurance Sector
Hurricanes, riots, and floods are a reminder of the necessity to understand the degree of exposure to a certain area or region of a country. Location intelligence solutions do this well, but their business case extends beyond reporting to being able to support the business in underwriting, marketing, regulation, and claims.
In a new report, Understanding the Value of Location Intelligence Solutions: Making the Business Case for the Insurance Sector, Celent examines the range of areas that can benefit from location intelligence or GIS solutions. Reporting exposure to a large-scale event within 24 hours, as done by one UK insurer, is a great example of the value of a location intelligence solution. This transparency assures shareholders, allows for correct allocation of insurer resources to the field, and ensures correct allocation of reserves.
The value of GIS solutions comes from saving costs or increasing revenue. But there is little evidence of insurers maximising the power of these solutions. “There are several examples in the industry of GIS solutions being used in an offline reporting manner or in only one functional area of the business. This is a vast underutlisation of an expensive resource,” says Catherine Stagg-Macey, Senior Vice President with Celent’s Insurance Group and author of the report.
This report looks at the business benefits for GIS tools in underwriting, claims, and marketing, and includes two examples of insurers who have benefited from GIS capabilities. Celent believes that such capability is an interesting addition to the options for technology-enabled business improvement.
For more information on vendors in this sector, see the Celent report Location Intelligence Solutions for Insurance: A Solution Spectrum, September 2011, for profiles of seven GIS vendors serving the insurance sector in Europe and North America.