Summary
A leader in general insurance in Canada with more than 4 million policies currently in place.
To integrate geocoding and address validation functions into the customer's software package, hosted in a Microsoft Azure environment.
A solution that combines ready-to-use data and software, in addition to managed services.
The client
The customer, a leader in general insurance in Canada with more than 4 million policies currently in place, faces several challenges, as do its competitors in the insurance industry, such as the increase in claims, change in consumer habits, and evolving technologies. To overcome these challenges, the insurer has set up a digital modernization initiative to gradually migrate all of its systems to a new cloud platform: Microsoft Azure.
While emerging technologies and artificial intelligence are now at the forefront, many companies are struggling to grasp this reality and take advantage of it. This is particularly true for insurance companies, which operate in a competitive market with ever-changing consumer habits, and where external factors, such as climate change, cast doubt on the reliability of historical data included in risk modeling and segmentation.
In addition to these external challenges, there is the constant issue of maintaining the quality of internal data. Email address validation and geocoding are essential to ensuring this quality and maintaining customer satisfaction. The address is the starting point for checking whether or not the person is already a customer. Next, insurers must differentiate between the address used to assess the customer’s risk level and the mailing address used to route important communications. Finally, the address is also used to process claims.
The Challenge
The insurance company, which registers more than 2.5 million new addresses annually, was looking for a way to improve the validation and geocoding of its addresses in order to better qualify new customers and assign a more accurate level of risk, as well as provide fairer pricing. If it is not accurate, the insurer could underestimate the price of a policy, creating excessive risk, or set a price too high, which could make it uncompetitive compared to competitors.
The customer also wanted to use software recognized by Canada Post’s Software Evaluation and Recognition Program (SERP) to minimize return mail and also have a reduced postal rate.
In addition to the software requirements, the customer wanted strategic advice and assistance in migrating its geospatial solutions to Microsoft Azure.
The solution
With its expertise and its range of diversified geospatial solutions, Korem was able to create a solution combining ready-to-use data and software with the insurer’s current platforms.
The Spectrum technological platform, which is the core of the solution chosen for validating and geocoding addresses as well as for managing geographic risks, consolidates and validates data from various internal systems. Spectrum then determines the geographic coordinates of each location based on multisource datum, enabling an unmatched level of precision. In addition, Spectrum assigns a unique identifier to facilitate the traceability of address changes.
Korem also helped facilitate the qualification of the insurer’s customers by implementing a business logic that automates a process that analyzes all the risks for an address in a tenth of a second for users. As a result of this automated background process, operational efficiency for underwriters and claims agents has improved, resulting in shorter quote times and fewer manual errors, while still being able to deliver a better customer experience.
The insurer wanted to limit investments in expertise for the operationalization of geospatial solutions, while maintaining increased control over the security of its systems and data. To meet these needs, Korem offered its managed services, enabling the Spectrum platform to be deployed in the customer’s Microsoft Azure cloud infrastructure. Korem’s expertise, combined with an Infrastructure As Code (IAC) deployment, means the insurer can benefit from better control over costs, response time and the security of its solution and its data. This way of operating has proven to be a great success, enabling the best of both worlds between SaaS services and local deployment. This collaboration and relationship of trust between the customer and Korem are also supported by Korem’s commitment to the security, confidentiality, accessibility and integrity of its customers’ data, framed by its ISO/IEC-27001:2013 certification.
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the Results
The final solution is highly dynamic, enabling versions of risk models developed by data scientists, actuaries, and GIS analysts to be deployed in minutes, unlike a SaaS model, in which updates can often take weeks or even months.
In the end, this initiative, which is part of a digital transformation program, has helped improve operational agility and reduce the expense ratio from 27.7% to 24.9% over the course of the past three years.
This agility, combined with the accuracy and reliability of the models, enables the insurer to stand out from the competition with fair prices and more daring coverage offers for its various insurance products.
