A data professional’s guide to jobs in the insurance industry

The insurance industry has been undergoing significant transformations, driven largely by technological advancements and changing consumer behaviours. Two areas at the forefront of this evolution are telematics and Usage-Based Insurance (UBI).

Telematics and usage-based insurance (UBI) are at the forefront of revolutionising how drivers are assessed, priced and offered coverage. By leveraging cutting-edge technology, insurers can now provide more personalised insurance policies, shifting away from traditional models based on demographics and historical data. One example would be the use of this model for new drivers. Drive well and you are rewarded with lower fees the following year, drive badly and pay more or not at all!

The integration of these technologies into insurance products not only offers more personalised pricing models but also requires a unique set of skills for professionals within the sector. Understanding the job market within this context and the necessary competencies can help both newcomers and seasoned professionals navigate their careers in the insurance industry. Having worked with insurance companies for the best part of 20 years, we have witnessed the evolution in the skill sets required first hand.

For data and tech professionals exploring opportunities in the insurance sector, particularly within the realms of telematics and Usage-Based Insurance (UBI), the transition might seem straightforward at first glance. However, the application of data analysis, technical expertise, and innovation within insurance, especially in these niche areas, requires a nuanced understanding of the industry's unique challenges and opportunities.

Here's a list of what sets apart the skill set for data professionals in insurance compared to other industries:

1. Domain-Specific Data Interpretation

While strong data analytical skills are a fundamental requirement across industries, insurance demands a deep understanding of risk assessment, actuarial science, and behavioural analysis. Telematics and UBI, in particular, involve interpreting driving behaviours, environmental conditions, and other contextual factors that impact risk. This necessitates not just technical proficiency in data analysis but also an ability to understand and predict complex human behaviours within the framework of risk and insurance models.

2. Regulatory and Compliance Acumen

The insurance industry is heavily regulated, more so than many other sectors where data professionals might work. This introduces a layer of complexity in how data can be collected, used, and stored. Data professionals need to navigate these regulations skilfully, ensuring that telematics and UBI data practices comply with privacy laws, data protection regulations, and insurance-specific legal requirements. This regulatory acumen is crucial for designing products that are not only innovative but also legally sound.

3. Ethical Use of Data and Bias Mitigation

Data ethics takes on a heightened significance in insurance. The potential for bias in data collection, analysis, and application is a critical concern, especially when it comes to setting premiums or making claims decisions based on telematics and UBI data. Professionals in this space must be adept at identifying and mitigating biases in datasets and algorithms, ensuring that decisions are fair, ethical, and transparent. This includes a thorough understanding of how to responsibly use sensitive data and protect consumer privacy.

4. Innovative Product Development

Unlike other sectors where data might primarily support operations or decision-making, in insurance, especially with telematics and UBI, data is directly tied to product development. This requires data professionals to think like product managers, understanding market needs, consumer behaviours, and technology trends to innovate and create insurance products that meet evolving consumer expectations. This cross-disciplinary skill set bridges data science, technology, and business strategy.

5. Customer-Centric Analytics

The focus on customer-centric products in insurance, particularly with telematics and UBI, demands a different approach to data analysis. Professionals must leverage data not just for risk assessment but also to enhance customer engagement, personalise offerings, and improve the overall customer experience. This involves analysing data to derive insights into customer preferences, behaviours, and needs, and then translating those insights into actionable strategies.

Salaries for roles specialising in telematics and UBI tend to be competitive, reflecting the high demand and specialised skill set required. Career progression opportunities are plentiful, with paths leading to senior analytical roles, product management, and strategic leadership positions.

While the core data and technical skills remain similar, applying these in the insurance industry, and specifically within telematics and UBI, requires a tailored set of competencies. Depending on who you speak to, as a data professional you can enter the industry without prior experience, however on the whole, domain-specific knowledge, regulatory expertise, ethical considerations, a focus on innovative product development, and a customer-centric approach are what differentiate the skill set needed in insurance from other sectors. For data and tech professionals, understanding and cultivating these specialised skills can open up rewarding opportunities to drive innovation in insurance.