As the insurance industry looks to 2015, businesses may be concerned about losing: losing money, losing customers to their competitors, and losing in the battle to improve their technological capabilities. One thing they're not worried about losing is data.
The amount of electronic information has skyrocketed throughout the past year, and that trend will continue through 2015. Insurers, which must keep billions of records and corporate documents year after year, will face an increase in risk and compliance requirements in order to keep up with different regulations in various jurisdictions.
It's time for insurers to focus on applying information governance to their vast stores of paper and electronic-based records, according to Bassam Zarkout, CTO at the information governance solution provider RSD. He defines this as the discipline of managing, making decisions with, and safely disposing of data while it is stored within an organization.
The expansion of data affects every division of the enterprise, and it's critical that the business is familiar with its data stores, Zarkout said. "You need to be aware of what that information is, and where it is, so you can respond to litigation and investigation."
In 2015, insurers will need to determine how they might respond to litigation, reduce litigation costs, and review the risks associated with possessing information they might not know they have, he said. This advice applies throughout the industry, but health insurers are more sensitive to litigation and must be prepared to react to things like audits and information requests from government agencies.
As they plan for better information management, insurers will focus less on investing in new systems and more on leveraging their systems that store data and link information with business processes, Zarkout said. They shouldn't remove the data from those systems, but they should apply technology that can apply governance to that information.
The demand for information governance will likely inspire cultural change. The industry once hoped that CIOs would assume responsibility, he said, but most of them have become more responsible for infrastructure than information. This leaves many businesses without a C-level executive to own the data management function.
"More organizations in the market are going to become aware that there has to be someone responsible for information and the governance of that information," he said. "I think we are going to see more large organizations adopting chief data officers or chief data governance officers." These data-focused executives will have experience in both business and IT. In addition to collaborating with the IT department on infrastructure, they will need to interact with the business to determine its information and regulatory needs.
Like employee safety, information governance will soon become a fundamental part of insurance organizations, Zarkout said. The volume of information is already presenting a challenge, and insurers must begin to address it now.
Kelly is an associate editor for InformationWeek. She most recently reported on financial tech for Insurance & Technology, before which she was a staff writer for InformationWeek and InformationWeek Education. When she's not catching up on the latest in tech, Kelly enjoys ... View Full Bio