As companies expand their operations internationally they are increasingly seeking the benefits derived from standardizing their operations and data to assess their exposures and return on capital.

“Firms are feeling quite a bit of frustration with the localized nature of their systems and the lack of data integrity in those systems,” said Gail McGiffin at Accenture. “They want better data integrity captured in the technologies to get a real view of their exposures. The global insurance companies want to get better alignment of data at the local level to leverage their capital better.”

That helps explain why the folks at ACORD are so hard to reach these days – the insurance standards organization is internationalizing rapidly and they are traveling constantly to take their standards message into new lands.

“Data has to be consistent,” said Denise Garth, vice president, membership and development at ACORD, “whether it flows through the insurance value chain from the initial quote to reinsurance, or just flows internally through a single organization. If you don’t have the same definition from end to end, it is difficult to do the analysis and understand what you have.”

TowerGroup’s Cynthia Saccocia warns against an all or nothing approach to data. Companies will probably take a more creative tactic than creating a data warehouse, she said.

“We need to be realistic in our expectations. Carriers are not likely to turn off their existing data stores.” Instead, they will look for tools to provide flexible access to data.

Celent’s Donald Light expects that companies will use business intelligence and reporting tools to get the results they need.

“Insurance companies clearly need to be able to roll up their results and compare them company to company. It is a serious problem given different regulatory reporting requirements and public accounting standards.”

McGiffin sees two related issues here – the commonality of data and the ease of doing business with the other side in a transaction.

“While a carrier might find a certain type of data is more valuable in predicting loss, they are more likely to gain from leveraging data they are already getting to yield more granular underwriting rules. They might know more about a certain type of manufacturing than their competitors, for instance, so they can align their rules to offer better pricing. I think the industry is headed toward a better use of existing data.”

Making better use of data requires modern systems, she added. Many large commercial policies are still stored in paper files.