It is a fact that insurance companies are changing their culture, processes and products often goaded by disruptive technology. Yet they face a potential trap! They get sidetracked collecting and analysing new and external data when they have a massive amount of internal data that is inaccessible and therefore not analysed. Let's come back to that later and look at some of this new data.

Take telematics, vehicles and insurance. Constantly monitoring the data from a journey does indicate whether a motorist drives more or less safely. It will deliver more data alongside that of an insurance claim. On the other hand it does not place the context in which the driver drove or the accident happened. It might seem that the driver was acting recklessly but on the other hand the other motorists may have been exceptionally reckless making the driver relatively cautious. 

In other words "big data, and telematics collects large amounts of data,but that is is not the same as "complete data". It is costly to store, maintain and analyse and often will offer little extra value. If a driver acts responsibly for 12 months she is likely to do so on the next journey so what extra value comes from the next 21 month's data?

The point I make is this; investing in new telematics big data solutions has to be considered against the option of analysing the data an insurance company already has. I have seen figures suggesting that 90% of an insurance company's data is text based and mostly unstructured and not analysed. It may be better to tackle that first rather than see potential ROI greener on the far side of the data lake. 

Another prediction: too few insurance companies will improve the claim experience sufficiently to encourage the claimant to provide more data voluntarily. In other words providing an intuitive and easy claim process that in return for having the claimant take photos, videos to augment the digitised claims form they speed the claim settlement. Do that and the claimant will stay with the insurance company and be more eady to give more information. That reduces the need for all this external data- not do away with it- just reduce the need as the insurance company already has more "complete data". 

In the rush for competitive advantage do not forget the existing data already held in the organisation. It maybe easier to retrieve than you think and far too valuable to leave and forget.

Not to say that you don't need to embrace disruptive technologies. You have to but in the right order of priority.