Other parts of this series:
To make the most of business data, CFOs need to act strategically
Given the data-driven nature of their industry, insurance CFOs have a natural predisposition towards driving new value from analytics, which to an increasing degree relies on intelligent automation tools. In fact, among the industries surveyed for Accenture’s “The CFO Reimagined: from driving value to building the digital enterprise” research, insurance scores in the top three for adopting artificial intelligence.
Robust data has always played a central role in assisting insurers to calculate and transfer risk. As technology matures, it offers organizations the opportunity to conduct more sophisticated and forward-looking analysis, which has a positive impact on the business as a whole.
The insights that insurance businesses stand to gain from elevated data analysis will shift them into a new paradigm of efficiency. But data is worth little on its own. While artificial intelligence can take over some of the more time-intensive analytical processes, businesses still require human insight to drive value.
How does this impact the role of the CFO? Finance is now being called on to fully engage in data governance across the enterprise and take ownership of data throughout the business. Over 82 percent of the insurance executives we surveyed confirmed that they are already starting to take control of critical data in the business, compared to 75 percent in banking. This trend stems from the historic nature of data’s importance in the insurance industry, combined with the complexity of accounting in the industry.
However natural the transition to non-traditional data sources and innovative business models may be for insurers, it does challenge businesses to redefine data governance. As insurers merge heritage internal data with data from new external sources including wearable technologies, telematics, the internet of things and application programming interfaces, new questions around governance arise. How can businesses make sound decisions in the face of a new wave of data, much of which is unstructured and in unfamiliar formats? This is where CFO’s have a major role to play. Over 35 percent of the executives surveyed believe that the insurer’s finance function should be responsible for developing best practices for combining different data sets. We anticipate that this proportion will only increase as more insurers analyze larger and larger volumes of external data.
In the final article in this series, I will define the top digital priorities for CFOs. If you would like assistance with defining your strategy and best practices pertaining to data, please feel free to contact me. In the meantime, for more on the redefined CFO role in insurance, you can read the full report here.