Data management is becoming a “battleground” for the group insurance industry as funds and insurers seek to create new, more personalised and sustainable products, according to Robert Nunez, head of industry funds at CommInsure.

The changes are a response to the soaring insurance premiums and the corresponding pressure from APRA on insurers and trustees to improve member data for the purpose of better pricing and risk analysis.

CommInsure is responding by opening an online ‘intel hub’ for funds to use to help with reporting and analysis, that will capitalize on what Nunez describes as Commonwealth’s “considerable” digital resources.

The hub allows funds to review, navigate and draw insights into their member’s claims and underwriting activity.

This initiative from CommInsure echoes moves by funds to hire heads of business intelligence or data scientists, such as Simon Sutherland at CareSuper, who was appointed in February.

Nunez said data management was turning into “a battleground” to help funds and insurers create better and more sustainable products.

“On the one hand funds are investing a lot more time and energy and resources on boosting their data analytical tools and framework,” says Nunez. “On the other hand insurers are investing more time and resources in coming up with more complex pricing processes and more detailed pricing processes.”

Nunez foresees a greater number hybrid products, particularly those with elements of income protection and total and permanent disablement cover that give greater emphasis to rehabilitation.

“Hybrid style products can reduce one-off claims and encourage greater collaboration, reduce confrontation and mean less need for lawyers,” said Nunez

On May 18, APRA wrote to all group insurers asking them to consider their risk controls in light of poor claims experiences. The letter asked insurers to make sure they were working collaboratively with trustees so that all relevant data was being collected.

The regulator also questioned whether insurers had adequate systems and resources to properly analyse and investigate data to identify any additional rating factors or leading indicators of experience.

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