Insurance and reinsurance create a lot of data. Some firms don’t have time, systems or experience in analyzing this data. AuclairRe has helped its clients look at data and decide what should be analyzed and extracted from databases.
We have looked at small and large databases to understand risk and underwriting issues. We see four types of analytics:
- Descriptive analytics which answer the question of what happened.
- Diagnostic analytics which is an analysis of historical data to answer the question of why something happened.
- Predictive analytics which analyze what is likely to happen.
- Prescriptive analytics which analyze what we should do to avoid past occurrences.
All four of these apply in the insurance and reinsurance industry. Underwriting is the analysis of historical results and the application of what future expectations can occur as well as the application of what prescriptions can be applied to mitigate future risk.