THE ANALYTICAL INSURER SAS AZERBAIJAN ANALYTICS SUMMIT, FEBRUARY 3RD

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1 THE ANALYTICAL INSURER SAS AZERBAIJAN ANALYTICS SUMMIT, FEBRUARY 3RD

2 AGENDA Analytical Insurance Understanding Customer Life Time Value Managing Call Centres Interactions The Digital Insurer

3 AGENDA Analytical Insurance Understanding Customer Life Time Value Managing Call Centres Interactions The Digital Insurer

4 FCCI Insurance Group anticipates a 1% to 1.5% percentage point improvement in their combined ratio by using business analytics. For FCCI this would equate to between $4.6m and $6.9m per annum

5 THE ANALYTICAL INSURER

6 AGENDA Analytical Insurance Understanding Customer Life Time Value Managing Call Centres Interactions The Digital Insurer

7 UNDERSTAND YOUR CUSTOMERS BETTER THAN ANYONE ELSE 2 Apply predictive and descriptive modeling techniques in order to understand customer behavior more deeply. Navigating large data volumes by specific data attribute(s) in order to gain insights and market most effectively to the customer. 1 3 Provide an integrated environment to manage big data as a valued asset for operational processes & strategic decision making. 4 Improving retention, cross-sell &upsell by identifying social communities based on relationships between clients; measure, segment & target clients based on social influence.

8 low Customer Value high TYPICAL SEGMENTATION Limited services Low discounts Do nothing Focus customers High services High discounts Expensive to keep these customers 0 Medium services Medium discounts Approach actively Do nothing low Probability of cancelation high No services No discounts Cancel actively

9 CASE STUDIES Focus on delivering superior service and not competing on price Discovered that 22% of customers contribute 80% of profit. Concentrating on this group saw a 25 to 50% uplift in cross sell response rates. Segment customers and provide actions to agents The portion of A and B customers could be increased by 20% in 20 months while the percentage of D and E customers could be reduced by 20%

10 CASE STUDIES AVIVA GETS THE FULL PICTURE WHEN DISESTAR STRIKES

11 AGENDA Analytical Insurance Understanding Customer Life Time Value Managing Call Centres Interactions The Digital Insurer

12 New Business Claim - FNOL Mid-Term Adjustment (MTA) Claim - Updates Mid-Term Cancelation (MTC) Renewal

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14 EXAMPLE DETECTING POSSIBLE FRAUD AT FNOL

15 AGENDA Analytical Insurance Understanding Customer Life Time Value Managing Call Centres Interactions The Digital Insurer

16 THE DIGITAL INSURER THE INTERNET OF THINGS

17 THE DIGITAL INSURER Much has been written on this topic Still evolving Insurers are starting on this journey Direct Line in the UK is one of many insurers promoting the 2 nd wave of telematics BNP Paribas Cardif in Italy offer Habit@t insurance package that uses technology to secure customers homes sensors for fire, smoke, water etc. US healthcare insurer Humana have partnered with Apple to share health data about the customer which can lead to lower premiums for Humana s customers

18 THE DIGITAL INSURER Much has been written on this topic Still evolving Insurers are starting on this journey For me, the insurer that is digital is the insurer that is very capable at smartly using data Nicolas Aubert AIG COO for EMEA Google has obtained license to sell insurance in 48 US states.

19 RESULTS IN NUMBERS? Traditional Data claims, policy systems Third Party Data Telematic Data Web Data

20 GLOBAL COMMERCIAL LINES INSURER BUSINESS GOALS Streamline time to market when developing, testing and deploying predictive models Create a replicable, accurate analytical process Gain and expand cultural adoption of analytics over more traditional methods within the insurance operations and lines of business RESULTS Enhanced accuracy in pricing, service and claims reserving Improved risk analysis and exposure Drive opportunities in new lines of business DATA - VARIETY With SAS we intend to delve into more data in ways that were once unimaginable, to glean unique insights we can use to drive profitable growth. SVP, Strategic Analytics Copyr i g ht 2013, SAS Ins titut e Inc. All rights res er ve d.

21 TIER 2 EUROPEAN INSURER BUSINESS GOALS Resolve data-quality issues to support customer needs and improve marketing efforts RESULTS Gained a set of data-quality rules for concepts like entities, products and addresses Solution was flexible enough to allow users to be selfsufficient in creating and changing business rules Clean, accurate, updated data easier for customers to understand Immediate intervention at sources of poor data quality DATA - VERACITY We achieved our goal of having customer data that is more accurate, complete and reliable with a tool that is easier to use. Business Solutions Manager Copyr i g ht 2013, SAS Ins titut e Inc. All rights res er ve d.

22 UK TELEMATICS INSURER BUSINESS GOALS Needed to analyze telematics data to gain critical insight into the large number of variables that contribute to how customers drive RESULTS Enhances pricing and marketing accuracy Better understanding customer profile and driving behavior DATA - VELOCITY Our telematics box collects up to 25 times more data than traditional telematics devices, and this is why we needed the powerful analytics solution we found in SAS. CEO Copyr i g ht 2013, SAS Ins titut e Inc. All rights res er ve d.

23 OCTO TELEMATICS TELEMATICS & ANALYTICS FOR MONETIZATION DATA - VELOCITY To date, Octo s success has been built on the capability to understand the needs of insurance companies and consumers CEO - Fabio Sbianchi SAS provides Octo with the analytical platform to analyze driver behavior and provide insurance companies offering innovative value-added services to customers, helping them to enrich pricing Copyr i g ht 2013, SAS Ins titut e Inc. All rights res er ve d.

24 TIER 1 UK INSURER BUSINESS GOALS Integrating at least 5 disparate data systems into a single user-friendly platform Faster, more accurate data to empower employees and improve decision making RESULTS Nearly four times as many people now supported with analytics and reporting Teams empowered with self-service reporting and analysis Increased speed and efficiency due to reliable data DATA - VOLUME SAS is instrumental in helping us achieve a more accurate view of our data allowing us to move faster and be more competitive. Group Head of Pricing and Management Information Copyr i g ht 2013, SAS Ins titut e Inc. All rights res er ve d.

25 EXPANDING ANALYTICS USE ACTIONS TO TAKE Sow the seeds of innovation Federate your structured and unstructured data Keep an eye open for new data sources Involve your business teams such as Underwriting and Claim Units into your analytical projects Focus on short-term successes for a BIG WIN

26 THANK YOU