Predictive analytics and business intelligence adoption in general insurance (for claims management)

Abstract

In conducting their day-to-day businesses, insurance companies are faced with both critical and non-critical decisions mainly on fraud management, claims management, actuarial management, and customer relationship management. These decisions are best supported by analytics and business intelligence and are mainly driven by proper claims management. In order to remain competitive in the insurance industry, companies are being driven to attain new capabilities in this area (analytics) especially in Kenya. Analytics is becoming a required competency in the industry and promises to provide a competitive advantage to companies that invest in it. Many claim executives want greater transparency into what drives operating costs, and more quantitative data about what factors determine claim outcomes (Keith, 2012). This research reviewed the adoption of analytics and business intelligence in the Kenyan insurance sector for claims management and proposed a cost-effective analytics and BI solution that can be used to manage the ever-changing business processes without having to procure commercial off-the-shelf analytics systems.