Precisely | InsurTech Whitepaper - Nov 2023

Confident decisions powered by trusted data

IN ASSOCIATION WITH:

The Precisely Data Integrity Suite fuels P&C insurers with trusted data, providing a comprehensive view of property risk when underwriting new policy

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s businesses react to macroeconomic threats and lower consumer spending, the need for them to make more confident and agile

business decisions takes on added significance.

Companies increasingly rely on data-driven decisionmaking to drive continued growth through uncertainty – and having access to trustworthy data to fuel that decision-making process becomes even more critical.

Headquartered in Burlington, Massachusetts, Precisely is the global leader in data integrity, empowering businesses to make confident decisions based on accurate, consistent, and contextual data – no matter what their industry, or the broader economic implications, throw at them.

Working across industries – including financial services and insurance, government, proptech, retail, and telecommunications, the Precisely Data Integrity Suite is designed to be flexible, modular, and interoperable, meaning it can adapt to client needs no matter where they are in their data integrity journey. The fact that Precisely works with 99 of the Fortune 100 companies is a testament to the business-wide value that they are able to deliver through their unique combination of software, data, and strategic services.

Within the insurance market, Precisely serves verticals such as life, health and annuity – but by far its biggest insurance line is P&C. There, the company has a similarly impressive footprint. All 25 of the 25 largest P&C carriers use Precisely solutions, along with a majority of the top 50. And generally, the company is talking to at least half of the top 300 insurers, helping them to solve complex day-to-day data challenges. precisely.com

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DANIEL TRATO TITLE: SOLUTION ARCHITECT COMPANY: PRECISELY

Daniel Tatro is a Solution Architect at Precisely. He has more than 2 decades in the field, spanning numerous verticals including insurance, telco and technology. He resides in Ballston Spa, NY with his wife and three children.

“We provide the confidence for insurers to make informed decisions about risk selection, pricing, and then overall understanding about the conditions of the property.”

– Daniel Trato, Solution Architect, Precisely

“That could involve providing

understanding about the conditions

technology mix, providing an

a 360° view of a customer across

of the property.” Tatro says.

algorithmic snapshot of previous

multiple policy administration

risks and giving insurers greater

systems,” explains Daniel Tatro,

Does climate change make

insight into how that risk might

Solution Architect within Precisely’s

data more important?

evolve over time.

Insurance Practice. “It could

One of the greatest challenges

be different lines of business,

facing P&C insurers today is the

McKinsey’s Insurance 2030

it could be personal, it could be

shift in the business environment

forecast predicts that “AI and its

commercial, it could be just different

brought about by climate change.

related technologies will have

policy administration systems

According to the authors of

a seismic impact on all aspects

because an organisation either

a report by Tata Consultancy

of the insurance industry – from

grew organically or grew

Services, “climate change is

distribution to underwriting

through acquisition.”

manifesting itself in the form of

and pricing to claims”. For P&C

changing weather patterns and

carriers, this begins with a deeper

The company’s “sweet spot”

increasing frequency of natural

understanding of the risks

within P&C insurance is location

catastrophes” – something that

that each new customer,

intelligence and property

P&C insurers must adapt to in

each new property, represents.

insights, Tatro explains, which

order to protect their businesses.

One of the most difficult risks

give insurers and landowners

A key part of this puzzle involves

to underwrite today is wildfire.

greater clarity around the risk

the strength of data and ensuring

As a result, some insurers are

that a subject property faces.

they understand emerging risks.

even beginning to balk at new

“We provide the confidence

property insurance policies in

for insurers to make informed

AI and machine learning (ML)

California, making wildfire the next

decisions about risk selection,

can be vital components of

potential ‘uninsurable’ line. When

pricing, and then overall

the insurance industry’s future

individual wildfire events can lead to

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precisely.com

property damage in the

age, which is a key determinant

tens of billions of dollars, it’s

in the risk of structural failure;

easy to see why P&C insurers are

analysing the outline of a building

becoming hesitant to protect

as well as impervious surfaces or

homes at risk of wildfire.

structures such as parking lots;

Precisely is utilizing synthetic

and detecting localised flood risk

aperture radar (SAR) to monitor

or wildfire risk, including vegetation

the moisture level in soil and

near a structure that might

gauge drought, giving a near

aid the spread of a fire.

real-time overview of the risk

But Precisely is more than just

of wildfire spreading.

a software and data provider.

Indeed, it sits at the intersection

99% of the Fortune 100 use Precisely

Precisely provides the most

between software, data, and

up-to-date property insights

strategic services. That is to say,

combined with easy data

its software is just the first step

enrichment, and sets up insurers

towards providing clients with

for success and innovation,

more trustworthy business data.

a certain property. It’s an added

“think of insurers combining our

Aerial images are incredibly

dimension that Daniel Tatro

property and enrichment data

useful – but they are not

describes as “ground truth”.

with areal imaging and drone

business insights themselves.

“If an insurer has a particular

footage,” says Tatro. This process

Instead, Precisely takes those

address, they could understand

covers a wealth of different

images and contextualizes them

that it’s a single-family residence,

possibilities – from examining the

to understand the risk that P&C

perhaps one piece of land,

condition of a roof, such as roof

carriers face from insuring

as well as what structures are

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on that land,” he says. “Precisely

Even when it comes to something

insurers confidence that

provides that level of ‘ground

relatively simple – like the

they have the full picture of

truth’ so that, when we as the

age of a roof – satellite imagery

a property’s risk. Precisely’s

algorithms to look at these

has the upper hand over self-

approach may also fill in data

images, they know the extent

reporting. A property owner

gaps, where data previously

of where to look and what to

may be unaware of their

didn’t exist. This can include risk

look for.”

roof’s age, or might only

factors such as roof height and

just have bought the property.

pitch, which can impact the risk

Providing insurers with

Yet artificial intelligence and

of hail damage. “It’s providing

greater trust in data

satellite photography can

confidence to the carrier that

Technology like satellite imagery

provide accuracy without the

they can trust the data they

helps provide an increased

human factor. But it’s not just

have in hand,” Tatro says.

accuracy level for insurers.

about accuracy. It also gives AI and ML also reduce the

All 25 of the 25 largest P&C carriers use Precisely solutions 6

precisely.com

need for manual inspections, which, as well as being less effective at spotting risk, are labor-intensive and, in some cases, even plain dangerous.

Aerial imaging prevents loss

adjustors from having to scale roofs, which could possibly result in them falling and getting hurt, because advances in technology allow this inspection process to be automated – with the overall benefit that assessments become more accurate. This

“I think the approach to risk detection and measurement is changing fundamentally. It’s becoming more current, the cadence is more dense.”

– Daniel Trato, Solution Architect, Precisely

is complemented by the use of unmanned aerial vehicles (UAVs), or drones, which Tatro believes will have a role to play in the insurance industry.

Learning to live with a changing planet Although the fight against climate change continues, insurers need to find ways to remain resilient today. António Guterres, the Secretary General of the United Nations (UN), has previously described the climate emergency as “a race we are losing”, albeit one that we can eventually win. Although many climate stakeholders remain confident of our ability to keep global warming below the agreed 1.5°C threshold, as set out in the

[become] daily, or it could

of threat at hand. This, in turn,

Paris Agreement, it’s still possible

be a few times a day. We haven’t

allows them to make more

that the short-to-medium term

necessarily had the technology

informed decisions about

will be defined by our ability

to support that kind of

accepting new clients, helping

to endure the side-effects of

measurement in the past.”

to optimise their loss ratios.

a changing planet.

He accepts that we don’t have

But it also empowers

the technology to change the

insurers to pass on practical

“I think we’re seeing the

path of a hurricane or prevent

advice to insureds that will

approach to risk detection and

an earthquake, but the depth

help limit their exposure to risk,

risk measurement changing

of data that Precisely has at

mitigate the damage caused

fundamentally,” Tatro says.

a property level, plus enrichment

to a customer’s property in

“It’s becoming more current,

of weather and demographic

case of an extreme weather

the cadence is more dense.

factors, allows insurance industry

event, and lower the amount

We’re seeing measurements

clients to understand the nature

they must pay out afterwards. precisely.com

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These timely warnings of

right staff to deal with claims in

lower a premium on a property

an impending event “could

a specific location.” Being able

in good faith if they believe

be as simple as putting your

to respond to a huge volume of

it to be high risk. “Of course

car inside a garage before

claims in a timely manner, and

insurers want to lower premiums

a hail event or convective storm”

allocating resources accordingly,

– just as consumers do – but

continues Tatro, noting on the

is another way that insurers can

more importantly they want

tangible and very real applications

realize cost savings in partnership

to ensure their premiums are

of data, like helping insurers to

with Precisely. “The ability of

in line with the potential

allocate internal resources in

an insurer to lower premiums

risk at a particular property.”

the build-up to a major event.

is entirely dependent on their

“A lot of insurers use third-party

understanding of risk at

What next for the Insurance

companies to deal with claims.

a location,” Tatro continues.

team at Precisely?

When a major event is coming,

“Those two things are tied at

As Tatro sees it, the end-result

they will make sure they have the

the hip. An insurer couldn’t

is not just about optimising an

“Some of the technologies we have mentioned weren’t commercially viable 18 months ago, yet they’re becoming table stakes for organisations.”

– Daniel Trato, Solution Architect, Precisely

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12,000

have mentioned weren’t

intelligence and property

commercially viable 18

insight gives us an opportunity

months ago, yet they’re

to play in the P&C space,”

becoming table stakes for

he concludes. “It proves

organisations. AI and satellite

future compatibility,

imaging will force everybody

the way we’ve been able

in the industry to stay nimble.

to leverage our current

insurer’s bottom line; it’s about

“Precisely’s foundational

technology in some of these

growing their slice of the pie.

understanding of location

fast-growing areas.”

customers

Higher customer satisfaction leads to higher renewal rates and lower churn, meaning more customers return year after year.

“All of these things contribute to a more efficient organization and drive lower premiums,” Tatro says.

This is crucial in today’s economy, where hard-pressed consumers are constantly re-evaluating the value they get from their insurance policies – and, indeed, where many policyholders might be contemplating not renewing in order to save money. Looking ahead to the next 12-18 months, Tatro expects to witness a continued transformation within the insurance industry, he explains: “Some of the technologies we

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Precisely is the global leader in data integrity, providing accuracy and consistency in data for 12,000 customers in more than 100 countries, including 99 of the Fortune 100.

Precisely’s data integration, data quality, data governance, location intelligence, and data enrichment products power better business decisions to create better outcomes.

Learn more at www.precisely.com.

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