Risk Insider: Henna Karna

5 Key Questions to Ask About Your Data Program

By: | July 9, 2018 • 3 min read
Dr. Henna Karna is a data scientist and Chief Data Officer of Bermuda-based multinational insurer AXL XL, a division of AXA, which recently unveiled DEEP, the industry’s first Digital Ecosystem & Engagement Platform. Karna can be reached at [email protected]

The biggest buzzword in the insurance industry today is “data.” Articles and studies cite it as a top strategic mandate. Nearly every insurer and broker is laboring furiously to transform their business around data. Unfortunately, much of this labor is in vain.

In the effort to prioritize data, whether it be predictive or historical, bold pronouncements are issued. Uncertain of the purpose and goals of the data initiative, IT or some other part of the organization is entrusted to “seize the momentum!” But without a clear end state in mind, the organization’s capital resources, budgets and skill sets are stranded along the way.

Many readers are probably thinking, “Well, that’s not us. We know what we’re doing. Our data initiatives are progressing along just fine.”

But is this true? Has data been elevated to a strategic imperative? Is the data initiative part of the budget in each department?

If the answers are no, then the data effort is not strategic. The company is in thrall with the idea of a data-driven ecosystem, but doesn’t really have one.

All or Nothing at All

There is no one-size-fits-all solution, yet businesses still need to put forth a data initiative that has both long and short-term strategy value across the enterprise. This is what is meant by an “ecosystem”—a holistic community of interacting parties drawing from the same pool of data for the collective benefit of the organization.

Unfortunately, this desired state is thwarted by the way in which companies create and manage the data strategy. Typically a part of the organization like IT, the data analytics group, or operations is entrusted with articulating and developing the data initiative. However, when this occurs, the data strategy tends to benefit that particular silo of people and not the enterprise as a whole.

For businesses to transform into data-driven entities, all decisions must flow from the data strategy. This is paramount.

Finding the Magic

If data is the key to enabling insurance to provide more useful products to customers at more competitive prices, then what’s needed is a declaration by the CEO that everyone in the organization must put data first and foremost into the context of everything they do.

Here are a few questions to ponder to ensure your business is being driven by a real data strategy:

  • Is data brought up in every meeting and conversation involving company strategy and tactics? Is it always on the agenda?
  • Is the data initiative explained in the company’s recruitment materials and orientation sessions?
  • Are products and services continually transforming to the dynamic insights produced by data?
  • Is there a budget for data and is this budget allocated across the enterprise with accountability for expenditures and a return on investment?
  • Is the CEO able to articulate to the team and to outside parties how data will transform the business and, by extension, the entire insurance ecosystem?

Honest answers to these questions are needed. Today’s insurance model has not changed in four centuries. The current paradigm is unsustainable in an era when Google and Amazon hold all the cards—the data along with the analytical know-how. These companies and other technology giants really are data-driven. The race is on. &

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

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But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

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Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]