Head of Information
IAG modernizes for big data
Australian insurer uses high-performance analytics to stay competitive, drive new opportunities
For many years, the insurance industry has been dependent on data to evaluate and price risk. However, using historical data for risk modeling may no longer be enough to maintain leadership as the age of big data is driving a seismic shift in the industry.
The insurance industry is vulnerable to disruption. However, there is huge potential to use our data with new sources to help insulate us from disruption and drive new opportunities with our customers.
Insurance Australia Group (IAG) is Australia’s largest insurer, possessing more than 50 years of business data. The company recognized early on that to stay ahead of the competition, it had to manage its information as a strategic asset.
Opportunities around big data
IAG’s Head of Information Joanna Gurry says the corporate advantage big data brings is the ability to combine new data sources and unstructured data with the deep history already available. “The insurance industry is vulnerable to disruption,” says Gurry. “However, there is huge potential to use our data with new sources to help insulate us from disruption and drive new opportunities with our customers.”
Jason Catania, who leads IAG’s Advanced Data Driven Services, says the customer experience for an insurer is very different from a bank or retailer in that some customers may only come into contact with IAG once or twice a year. “We need to be able to use all the data available to us to ensure that interaction is a great experience for the customer,” says Catania.
Business transformation required a new platform
Recognizing that across financial services there are great examples of transformed customer experience, IAG started a journey to build a strong data and analytics capability and to modernize the enabling platforms.
As a SAS customer for more than 30 years, IAG turned to SAS’ advisory team to help understand how it could scale up the use of its technology and create a leading big data strategy.
IAG deployed SAS’ latest and most powerful High-Performance Analytics (HPA) platform in conjunction with a Pivotal Data Computing Appliance from EMC.
Processes that used to take hours can be reduced to minutes. For example, in initial testing IAG saw the time it took to analyze 20 million records against 186 variables, reduce from 17 hours to just one minute. This could mean where actuaries and modelers were previously restricted to a cycle of one model a week, they can look toward cycling many models each day.
“Analysts are really excited as they can now see what’s possible,” says Catania. “They can run multiple nodes not only faster but in parallel, which will help us to increase productivity and deliver more accurate, collaborative outcomes.”
A partner engagement
Gurry says the engagement has been outstanding from the start. “SAS is a strategic technology partner to us,” says Gurry. “It’s been a long-term view where we looked at what we wanted to achieve, and together, developed a roadmap for the future. And if SAS made a promise, we could absolutely trust them to make it happen.”
Catania adds that the flexibility and professionalism in the commercial negotiation was also a stand out. “Not only was it clear that SAS was investing in the partnership, but the plan, strategy and roll out was delivered to a tee,” says Catania.
Gurry says the value they gain from thought leadership, best practice and international expertise is an important part of the partnership. “We like working with SAS’ advisory division because it’s clear they don’t just want us to buy more solutions, they want to make sure that we challenge our thinking and consider new ideas for gaining the most from our investment.”
“At the core of it we want to be able to give our customers an unparalleled experience, have flexibility in our business and the ability to quickly pursue new opportunities,” says Catania. “Modernizing our technology is a key enabler.”
Gurry says since the upgrade to the new platform, IAG is well on the way to realizing the power of its data. “Advanced analytics is a high priority for IAG,” says Gurry. “We have a lot of data, but now we can start unleashing the power of that information.”
IAG wanted to manage its information as a strategic asset to help insulate from disruption and drive new opportunities.
Initial testing saw a reduction in the time to analyze 20 million records against 186 variables, from 17 hours to just one minute.