Use of social data can be expanded into insurers’ core functions: Celent

Insurers can expand their use of social data to build real-time risk profiles in underwriting, a Celent report suggests. In its report, ‘Using Social Data in Claims and Underwriting: Creating a Social Risk Profile,’ Celent recognizes that the use of social data is still in its formative stages.”However, it also must be remembered that, at one time, previous innovations such as multi-tiered automobile pricing, predictive analytics, and the use of teleunderwriting in place of attending physician statements, were viewed as optional changes to long-standing insurance processes,” the report says.”Celent predicts that social data will be incorporated into core underwriting and claims processes over the next three years and become standard inputs into risk evaluation and settlement activities.”In order for this to be achieved, key techniques that must be developed or enhanced include authentication methods, improved data extraction tools, and more advanced analysis tools. Regulation around the use of social data is evolving more slowly than the technology and potentially will significantly affect the use of information collected from these public forums, it continues. “Social network data are currently being used as sources of evidence in courts of law in claims cases. Individual underwriters are retrieving valuable risk evaluation information on their insureds through manual searches on social sites,” the report says.”Just as insurers recognize a link between credit health and risk in auto insurance, social data may offer similar insights for insurers who set out to crack the data.”