Best practices: For the want of a nail the kingdom was lost...Mother Goose was right: Profit by Best (Data Quality) Practices
Like the missing horseshoe nail that cost a kingdom in the old Mother Goose nursery rhyme, faulty data can produce devastating bottom line consequences in the property / casualty insurance business.
Consider how incomplete or miscoded data can produce cascading miscalculations in underwriting, risk selection, coverage and pricing. Data is at the heart of customer service and support functions. Claims data — from both internal and external sources — support decisions and planning for claims settlement. Past claims experience help companies identify emerging claim trends. The quality of data can lead to either profitably helpful or dangerously misleading predictions for future claims-adjustment and settlement costs.
Insurers use data to manage litigation, detect fraudulent claims and limit financial exposure to claims through reinsurance, but this practice works only when the data is credible. It is no overstatement that sound, profitable property / casualty operations begin — and end — with quality data.
But what is quality data and how can companies attain and sustain that quality?