Insurers are privy to large amounts of data, including personally identifying information. Your business requires you to store information about your policyholders and your employees, putting lots of people at risk if your data isn’t well-secured.
However, data governance in insurance goes beyond insurance data security. An enterprise-wide data governance strategy ensures data is consistent, accurate, and reliable, allowing for informed and effective decision-making.
If you aren’t convinced that your insurance data standards need a second look, read on to learn about the impact data governance has on insurance, the challenges you may face, and how to develop and implement a data governance strategy for your organization.
Why Data Governance Is Critical in the Insurance Industry
As previously mentioned, insurance organizations handle a lot of data; and the amount of data you’re storing likely grows day by day. Data is often siloed as it comes in, making it difficult to use at an enterprise level. With growing regulatory compliance concerns – such as the impact of the EU’s General Data Protection Regulation (GDPR) in insurance and other regulations stateside – as well as customer demands and competitive pressure, data governance can’t be ignored.
Having quality, actionable data is a crucial competitive advantage in today’s insurance industry. If your company lacks a “single source of the truth” in your data, you’ll have trouble accurately defining key performance indicators, efficiently and confidently making business decisions, and using your data to increase profitability and lower your business risks.
Data Governance Challenges in Insurance
Data governance is critical in insurance, but it isn’t without its challenges. While these data governance challenges aren’t insurmountable, they’re important to keep in mind:
- Many insurers lack the people, processes, and technology to properly manage their data in-house.
- As the amount of data you collect grows and new technologies emerge, insurance data governance becomes increasingly complicated – but also increasingly critical.
- New regulatory challenges require new data governance strategies or at least a fresh look at your existing plan. Data governance isn’t a “one-and-done” pursuit.
- Insurance data governance efforts require cross-company collaboration. Data governance isn’t effective when data is siloed within your product lines or internal departments.
- Proper data governance may require investments you didn’t budget for and red tape can be difficult to overcome, but embarking on a data governance project sooner rather than later will only benefit you.
How to Create and Implement a Data Governance Plan
Creating a data governance plan can be overwhelming, especially when you take regulatory and auditing concerns into account. Working with a company like 2nd Watch can take some of the pressure off as our expert team members have experience crafting and implementing data management strategies customized to our clients’ situations.
Regardless of if you work with a data consulting firm or go it on your own, the process should start with a review of the current state of data governance in your organization and a determination of your needs. 2nd Watch’s data consultants can help with a variety of data governance needs, including data governance strategy; master data management; data profiling, cleansing, and standardization; and data security.
The next step is to decide who will have ultimate responsibility for your data governance program. 2nd Watch can help you establish a data governance council and program, working with you to define roles and responsibilities and then create and document policies, processes, and standards.
Finally, through the use of technologies chosen for your particular situation, 2nd Watch can help automate your chosen processes to improve your data governance maturity level and facilitate the ongoing effectiveness of your data governance program.
If you’re interested in discussing how insurance data governance could benefit your organization, get in touch with an 2nd Watch data consultant for a no-cost, no-risk dialogue.