Andy Jones, head of risk engineering, property and casualty on how risk managers can overcome the biggest big data challenges

Big data and predictive analytics a hot topic discussion point at this year’s Airmic annual conference 2019. Why is it so important to risk management?

Data is being generated at a faster rate than ever before, whether from data processing to sensors installed in production lines, offering potentially a new and unique view into the risk landscape of businesses.

The ability to analyse and derive insight from data offers today’s risk manager the opportunity to identify interactions or trends within data sets that otherwise would go unnoticed due to the difficulty in handling significant quantities of information by traditional means; for example the ‘good old’ spreadsheet.

This is particularly true when looking at unstructured data or merging multiple data sets from different sources to gain a new insight into a situation. Blending the data and seeing insights coming to the surface which challenge your understanding of a situation and offer the opportunity to investigate new solutions to risks can at times seems like part science and part art.

As more AI and robotics are introduced into industry the analysis of data and the interpretation of what is actually happening will become a key aspect of risk identification and management. Data has the potential to become the future language of business that we all need to be able to translate.

What are the biggest challenges for risk managers?

Currently I see data analytics being used in three distinct areas:

  • As predictive tools – focused on the avoidance of future losses
  • As a validation process – answering the ‘why did this happen’ scenario/situation
  • Driving operational efficiencies – reducing time/resources required to get to the desired end result

However, I see the real key challenge as determining - “what is the question we’re trying to answer?” I think this will become the challenge that will tax risk managers going forward as we learn to manage large data sets and then try and work out what it is telling us.

What are your tips for overcoming these challenges?

  • Start small in areas of risk you are familiar with
  • Be prepared to invest time, effort and resources to explore this emerging field
  • Look to universities for partnerships and support – think about supporting projects and work experience placements.

What is MS Amlin doing to help risk managers become more data mature?

We are incorporating data analytical capability into our risk engineering offering for corporate clients and offering support through our team of data engineers and scientists to work in partnership with clients to explore their data and help them gain new insights into areas of risk management currently causing them insurable losses with the aim of helping them to improve their management of risk in doing so building resilience into their business.

To learn more come and see our workshop – Data Jiu Jitsu ‘the emerging art of providing risk management insight to clients through data analytics’.


This article is sponsored by MS Amlin

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