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Top 3 Tips to Safeguard Customer Data

Insurance companies can serve customers better when they have access to accurate data and use it to send personalized, relevant messages that deliver value to customers, and customers are becoming increasingly pragmatic about sharing data — 58 percent are willing to share personal information under the right circumstances. They understand the bargain they make when they give companies access to information: “I’ll share my data with you if you protect it and use it in ways that benefit me.”  

Opt-in programs featuring telematics devices for insured drivers are one example, but there are many other instances where insurers collect customer data. Gathering mobile phone contact and social media information can enable proactive communication for a variety of purposes, and it can be beneficial to both companies and policyholders when they establish strong, trust-based relationships. 

While consumers are attracted to the potential benefits of data sharing, they’re also understandably concerned about the risks to their personal information. In fact, 81 percent of consumers say they’ve become more concerned about how companies use their data over the past year, according to an IBM study. So, as an insurance technology professional, if you want to facilitate a mutually beneficial data exchange with more customers, maintaining robust data security — and letting customers know you’re protecting their data — is a must. Here’s how:

  • Cover the basics: Insurance companies are a top target for hackers because of the sensitive nature and potential monetary value of the information they collect. Accordingly, insurers spend a great deal on cybersecurity. But employees often prove to be a weak link, falling for phishing scams that can make the most robust firewalls and anti-malware measures ineffective. That’s why it’s a good idea for insurance companies and their technology vendors to provide employee training on how to detect spoof URLs and fake websites before they click on a link that allows a hacker to steal their credentials. Measures like these are obvious, but major data breaches are often traced back to a simple attack vector like phishing, so cover the basics.
  • Ensure architecture safety: Insurance technology leverages APIs to improve service for customers and the bottom line for insurers. Even companies without a comprehensive big data strategy can use APIs to connect single-function programs and applications to enable data transmissions that make sending personalized messages for customers possible. But while these techniques can allow insurers to realize the full value of customer data, API use can also increase risk exposure if it’s not handled with care on a secure architecture. For that reason, it’s critical to use an architecture that lets the company perform API functions that harness customer data while minimizing exposure of information.  
  • Practice what you preach: Insurers that offer cybersecurity policies to other companies often include requirements for coverage, such as mandatory annual training for staff. The insurance industry has been praised for improving security by demanding that the businesses it covers reduce vulnerabilities. But insurance companies and their tech vendors don’t always practice what they preach. For example, some still rely on usernames and passwords for access to sensitive data. It’s a good practice to implement tougher measures like three-factor authentication. Regular audits can also improve security and keep policyholder data safer. 

When insurance companies combine data and technologies like APIs to personalize service, they can build stronger relationships and improve policyholder “stickiness.” As more consumers use devices like AI-enabled personal assistants to shop and get information online, insurers who want to compete and win in the space must handle data effectively to continue the conversation on new platforms.

Forward-thinking insurers are already finding that customers are receptive when they consistently deliver value in exchange for data. The rapid growth of telematics demonstrates that, with auto-related data monetization program value expected to reach $750 billion by 2030, according to McKinsey. But building trust is the first step. When customers know you take their security seriously, they’re more likely to share data with you. Data then allows you to improve service and outreach at every step in the customer journey. That’s a win for you and your customers. 

About Tara Kelly

A serial innovator, published author and founder of SPLICE Software, Tara Kelly (@TKtechnow) is passionate about technology’s potential to change lives for the better. She has consistently channeled that belief into developing technologies that enhance operations, enable better service delivery, and improve the customer experience. This has resulted in creating three customer experience companies and turning an innovative idea into a patented, proprietary technology (US Patent Number 9348812) that harnesses data streams to create personalized, automated messages.  

Kelly – an open source activist and recognized user experience designer – served as a board member for the International Board for Voice User Interface Design, the Canadian Cloud Council, Technology Alberta and is a member of the Entrepreneurs Organization. Kelly’s expertise combined with tenacity, understanding of market trends, and strong communication skills has allowed her to create dynamic solutions and successful teams; not only in her businesses, but also as a community leader on volunteer boards including Food for the Sol, EO Water Walk, and Special Olympics Ontario. Kelly shares these experiences – and her goal of creating a healthy, humane work environment – in the recently published book, Our Journey To Corporate Sanity: Transformational Stories from the Frontiers of 21stCentury Leadership.  



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