Data initiatives abound in the insurance industry. Most carriers have some type of data initiative in place. They focus their efforts on implementing reporting tools, analytic tools, and repositories — with all the tools that go with them.
Data governance, on the other hand, is an emerging discipline. The discipline includes a focus on data quality, data management, data policies, and a variety of other processes surrounding the handling of data in an organization. The purpose is to assure carriers that they have reliable and consistent data sets to assess performance and make decisions.
As the insurance industry moves into a more data-centric world, data governance becomes more critical for ensuring the data is consistent, reliable and usable for analysis. Analysis and reporting issues are more often related to data governance issues, not technology issues.
Data governance initiatives are generally designed to ensure the data is accurate, consistent and complete in order to maximize the use of data to make decisions, to find unique insights and to improve business planning. It ensures that your data capture mechanisms are set up to capture what you need to capture and ensures alignment between analytics tactics and strategic goals.
But carriers face governance challenges. Data is spread across a wide variety of applications, and data ownership is most often shared across the business and IT. Carriers report cultural resistance to understanding data issues, which makes it harder to find sponsors for data governance initiatives. Consequently, a large number of carriers deploy informal data governance initiatives — especially larger carriers.
I’ve just published a new report that surveys carriers around their attitudes, challenges, and initiatives related to data governance. Some very interesting findings. Check it out. http://celent.com/reports/importance-data-governance-current-practices
This blog has been reprinted with permission from Celent and Insurance Networking News.
Karlyn Carnahan is research director at Celent.