Is your corrupt data contaminating your reinsurance programmes?
Managing IT systems and data migration
With the recent ‘live’ market consolidations and within the ‘legacy’ environment, an appetite for portfolio purchasing on the increase. However, the provisions to manage the consequent IT system mergers and data migrations have come under increased scrutiny.
These activities are forging ahead, due in part to the financial attraction of releasing equity, but also as our increasing professional and technically competent work force is eager to make its mark on this thriving economy.
The obstacles to achieving data integrity
One of the most difficult areas with the application of this ever-sophisticated technology is its reliance on the integrity of its underlying data – without which we would all be ‘Driving in the Dark’. Since the 1960’s the gradual reliance on ‘good’ data has been the lifeblood of any enterprise and none more so than the (Re) Insurance industry. Without statistical analyses based on increasingly detailed transaction recording, projected development for risk assessment would not exist.
The consequences of data pollution
The accurate coding of policy and claim descriptions is a fundamental activity that permeates through the whole risk life cycle. An inaccurate description of either will have consequences – many of no value but some, could ultimately affect the liquidity of an organisation if they are of sufficient value and numbers and remain unchecked. Mis-coded policies can have attaching claims that are seen to be unrecoverable through a reinsurance policy and conversely miscoded claims may be recovered under a policy that would not normally have responded had they been coded correctly.
Data & profitability
The consequent misrepresentation of an accounts’ profitability will affect Management Information, Reinsurance Programme activity, Cash Flow and ultimately the reputation and rating of the company’s ability to do business.
Maintaining accurate data
However, the process of ensuring data integrity can be complex. An endless stream of code validation processes and regular and ad hoc Management oversight may appear to be sufficient – then the inevitable Inspection of Records request appears! To even the most professional of operations, this can cause a collapse in confidence and a mass exodus of support from within the industry.
Solutions to acquiring data integrity
An integrated solution to the problem incorporating:
- A diligent approach to Data Entry
- A composite validation programme
- An algorithmic approach to portfolio review
- A regular testing environment
- A rigorous maintenance programme
Employing a multiple pronged approach would in the short term appear over cautious and expensive – it would however provide the level of confidence necessary to maintain a healthy book of business that will instil certainty in Reinsurers minds and a degree of transparency unparalleled by peers.
If you would like to discuss how you can achieve this data integrity guarantee, contact our team on 020 7971 1141 or email data@legacydatasolutions.co.uk