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How can insurers analyse data intelligently post-GDPR?

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How can insurers analyse data intelligently post-GDPR?

By Scott Logie, Customer Engagement Director, REaD Group

2018 has, to date, been a year of global petitioning for diversity. The media reports about equality increase daily, therefore it was no surprise that, when accusations emerged surrounding how insurers calculate premiums and the potential impact ethnic names have on this, there was media uproar.

The Sun newspaper and BBC’s You and Yours’ radio show both conducted their own research into the allegations, causing the insurance industry to come under intense scrutiny. The allegations of discrimination against ethnic minority names is a prime example of why it is so important for insurers to ensure that customer data is being analysed in both a non-discriminatory manner and in the most efficient way possible. In the run up to the EU General Data Protection Regulation (GDPR) coming into force on 25th May this year, there is a pressing need for businesses to review how they are currently examining the data they have access to. Following this, they must seek out effective ways of analysing data more intelligently to drive business growth.

Are insurers overlooking the current data they have?

The UK insurance industry is one of the most data rich industries in the world. The amount of data available to insurers has increased dramatically in recent years, with online search and telematics data playing a large part in this. And this influx of data isn’t about to slow down. Despite this, insurers do not reap the full benefits of having access to mass data. Deloitte found that 70 per cent of insurers analyse data by investigating tactically with a short-term focus. This aims to generate immediate gains and profit. Instead, insurers need to shift their focus to a more long-term approach which will help them to respond better to industry disruption and allow them to analyse data more intelligently.

The importance of transparency

Trust between consumers and insurance companies fluctuates based on current affairs. For example, following these allegations of ethnic discrimination, consumer trust for insurers will be lower than it has been previously. The Chartered Institute of Marketing indicates that over half of all customers (57 per cent) do not trust organisations to manage their data responsibly. Recent controversy surrounding the alleged harvesting of Facebook user data by Cambridge Analytica will have added fuel to this fire. GDPR provides insurers with a fundamental opportunity to strengthen the image of their own companies and the industry as a whole. Insurers who embrace the new standards of customer privacy will position themselves as trustworthy data managers with whom consumers can trust to share their personal data with. In order to achieve this, under GDPR, insurers must display greater transparency by being clearer with customers around how their personal data is handled. This then provides an opportunity to rebuild customer relationships and trust.

Data sharing becomes a two-way relationship. Insurers need to communicate with customers, but customers can use their data to aid their own insurance pricing. This can be particularly demonstrated by car insurance providers. If the consumer is prepared to share data collected from their car journeys, data already gathered by most cars, insurers will consequently be able to deliver a more custom-made policy. The consumer will then benefit from better value for money as their quoted insurance price is not based on a generic customer profile – but rather their own driving habits. Improved personalisation not only benefits the consumer, but also the insurer. It has been found that return on investment is 30 per cent higher for companies who use data and analytics to personalise their customer engagement.

How can insurers make sure that customer data is relevant, accurate and permissioned under GDPR?

Data needs to be relevant. GDPR offers insurers a chance to review their data and essentially filter it so they retain the data points that are relevant to them as an insurance company.  By doing so, the data will become more accurate as insurers will be left with a pool of consumer data that specifically meets the needs that are relevant to them.

Permission and consent underpins the process of GDPR. By ensuring that data sharing is consented to by customers and prospects, insurance companies will be able to position themselves as responsible and truthful corporations, providing a much-needed boost to their brand image, and engendering customer trust. This consent must be obtained in the most clear, simple and accessible way. Long, complex documents are going to create confusion and push consumers away. A concise summary form will be the best method for ensuring customer understanding and therefore successfully obtaining consent. Insurers such as Aviva have been quick to implement this, taking action to ensure that key pieces of information are only requested once.

GDPR: building trust between insurers and customers

As insurance is such a data-rich sector, some may argue that GDPR reduces the amount of data that insurers will have access to. However, insurers should be shifting their mindset to focus on the increased quality of data that they will have access to rather than just volume. Insurers have the opportunity to better understand customers and therefore provide more tailored communications to them. However, the success of this will be based on their ability to build an open relationship between themselves and the consumer where insurers regularly inform consumers what their data is being used for.

It is important that insurers understand the real value of the contacts they have clear consent for. They must invest time into understanding the consumers’ wants, needs and interests. Rather than viewing GDPR as restrictive, insurers must realign and become mindful of what data they are storing, where it is being stored and how the data is being used. Their data needs to become personalised.

This is where data segmentation becomes a really important tool. It is something that companies do not make the most of with only a third of marketing using segmentation. However, if used well, it can be a powerful tool in improving the quality of data that insurers work with. By carrying out data segmentation, insurers will be able to build more detailed profiles of their customers. Initially, profiles are created which would allow insurers to understand which of their customers are active and valuable, and what channels these customers are engaging through. Data segmentation is unique because it is multi-dimensional. This means sub-groups of customers are often formed that would not be discovered otherwise, opening your database to encompass more detailed groupings of customers and bridging the gap between mass marketing and one-to-one marketing.

A crucial few months ahead for insurers

GDPR clearly arrives at an essential time for the insurance industry. The regulation presents insurers with the opportunity, if they use it effectively, to rebuild consumer trust and position themselves as trustworthy and respected corporations. If insurers play their cards right and shift their focus from a business perspective to a people perspective, then GDPR will drive their business growth substantially forward.

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Holiday bookings soar as Britons hope for travel restart

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Holiday bookings soar as Britons hope for travel restart 1

By Sarah Young

LONDON (Reuters) – International holiday bookings surged by as much as 600% after Britain laid out plans to gradually relax coronavirus restrictions, giving battered airlines and tour operators hope that a bumper summer could come to their rescue.

EasyJet said flight bookings from Britain jumped over 300% and holiday bookings surged by more than 600% week on week after the government indicated on Monday that travel could restart from mid-May, while holiday company TUI UK said that its holiday bookings surged 500%.

This summer is make-or-break for many airlines and holiday companies which are struggling to survive with close to a year of almost no revenue due to pandemic restrictions. Without it many will need extra funds after burning through cash reserves.

UK-listed travel stocks were buoyed after new bookings flooded in on Monday evening and Tuesday despite ongoing uncertainty over exactly how and when international routes can reopen.

Shares in easyJet jumped 9%, while British Airways-owner IAG traded up 6%, TUI and Jet2 both jumped 6% and Ryanair was 3% higher.

While British tourists are some of the biggest spenders in Europe, the presence of a more infectious variant of coronavirus in the UK could alarm some countries. France and Spain have shut their borders to most UK travellers due to variants.

UK holidaymakers will know more on April 12 when the government publishes a travel review. It has said that a lockdown ban on most international travel will stay until at least May 17.

That should give airlines time to plan their summer schedule, a process which takes months.

EasyJet said trips from the UK to beach destinations such as Malaga, Alicante and Palma in Spain, Faro in Portugal and Crete, Greece, were the most popular destinations with holidaymakers keenest to travel in August. July and September were the next most popular months.

TUI said destinations in Greece, Spain and Turkey were the most booked overnight, with people opting to go from July onwards.

Britain’s route back to normality is helped by rapid progress with its vaccine plan. Over 17.7 million people, or a quarter of the population, have already had a first dose of the jab. The government is also considering options for vaccine passports.

The airlines and travel companies hope such progress will mean that from May 17 the UK will end its holiday ban and remove a 10-day quarantine requirement, a big deterrent for holidaymakers, and some of its COVID-19 testing rules.

(Reporting by Sarah Young, Editing by Paul Sandle and Susan Fenton)

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Concern over rich-poor divide seen on the increase during pandemic

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Concern over rich-poor divide seen on the increase during pandemic 2

By Matthew Lavietes

NEW YORK (Thomson Reuters Foundation) – People have become more concerned about the gap between rich and poor during the coronavirus pandemic, especially the young, the authors of a new global study said on Tuesday, urging governments to take steps to redress the balance.

More than 8,700 people in 24 nations were surveyed at the start and end of 2020 by the Glocalities market research agency, with the findings showing an increase in the share of respondents who thought income differences should be reduced.

As the coronavirus pummeled the global economy last year, the survey also found a 10-point rise in the percentage who said decent work and economic growth were the most important means of improving quality of life.

“It has slapped people in the face and made them realize that things are not going well,” Ronald Inglehart, one of the lead authors of the study, told the Thomson Reuters Foundation, referring to the pandemic.

“We need government intervention on a larger scale. We don’t want a state-run economy, but some of the resources need to be reallocated to balance off this powerful trend.”

Policies that will create “good-paying jobs” in the fields of child care, environmental protection and infrastructure would help address mounting frustration over income inequality Inglehart added.

Young people are particularly concerned about income disparities, the study found.

A third of respondents aged between 18 and 34 said they were more concerned about income inequality than unemployment or economic growth at the end of 2020, up from 29% at the start of the year – before the coronavirus had spread around the world.

“Feelings of being upset, being afraid, feeling let down, feeling like ‘I have no prospective anymore’ are on the rise,” said Martijn Lampert, who also co-authored the study.

“So this requires very wise and just government interventions to channel this unrest in a positive way.”

Inglehart said he sees evidence of such sentiments among the students he teaches at the University of Michigan.

“The job market is dismal … My best students, the stars, they’re finding jobs at a lower level than they’re anticipating. And the ones who aren’t stars are getting nothing,” he said.

The global economy is seen shrinking 3.5% last year, according to the latest estimates by the International Monetary Fund, and numerous studies have shown how the global health crisis has exacerbated economic inequalities.

As a result of the pandemic, the number of people living in poverty has doubled to more than 500 million, according to a report issued last month by the charity Oxfam.

Meanwhile, the collective wealth of the world’s billionaires rose $3.9 trillion between March and December 2020 to reach $11.95 trillion, the report said.

(Reporting by Matthew Lavietes; Editing by Helen Popper; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org)

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Boon or bane? Malaysian island reclamation plan divides residents

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Boon or bane? Malaysian island reclamation plan divides residents 3

By Rina Chandran

(Thomson Reuters Foundation) – The island of Penang on the northwest coast of Malaysia is known for its sandy beaches, the colourful wall murals of its capital Georgetown, and its fiery street food.

In time, it will also be known for three man-made islands that state authorities say are needed to provide housing and economic opportunities for an expanding population, while also generating funds for a modern transport network.

But the Penang South Reclamation (PSR) project, dubbed BiodiverCity, has pitted the government and businesses against fishermen and environmentalists who say it will wreck the lives of residents, and damage the coast.

“The area is rich in prawns and fish. If you build islands, what we will see is permanent environmental degradation,” said Mahadi Md Rodzi, chairman of the Penang Fishermen’s Association that represents about 6,000 fisherman.

“Fishermen have been told to upskill or get another job, but many of us are born fishermen and depend on the sea to live. The proposed compensation from the state is too insufficient for something that will affect our livelihoods forever,” he said.

Many fishermen have rejected the 20,000-ringitt ($4,950) compensation offered, as well as the Environmental Impact Assessment report, which conservationists say does not reflect the potential damage or propose adequate mitigation measures.

Authorities say BiodiverCity, which is a part of the Penang 2030 vision of improving liveability and sustainability, will be a “socially and economically inclusive development” with an emphasis on green spaces, clean energy and car-free transport.

The 4,500-acre (1,821 hectares) project comprising three lilypad-shaped islands will house about 15,000 people each, and use natural and recycled materials such as bamboo and timber for construction of homes and offices, according to the plan.

But the scale of the dredging and reclamation work over more than a decade will cause “massive and long-term environmental destruction”, said Evelyn Teh, an environmental researcher in Penang.

“Fifteen years of land reclamation is a long onslaught to any marine ecology and the fishery industry that depends on it. The reclaimed islands will bury existing fishing areas while deteriorating the surrounding marine water quality,” she said.

“Coastal communities who rely on the marine and coastal area for their livelihood will experience an irreversible negative impact,” she told the Thomson Reuters Foundation.

‘COLOSSAL MISAPPROPRIATION’

From Denmark to Singapore, planners have reclaimed land from the sea for decades for offices, apartments and tourism.

Cities and island states that are running out of space are reclaiming land, expanding vertically or going underground.

A United Nations-backed partnership is studying the prospect of floating cities that can help coastal cities at risk of flooding from worsening climate-change impacts.

In Asia, land reclamation has become a contentious issue, with Cambodia and Malaysia banning sand exports, while Jakarta has suspended its reclamation project, and a plan to build an artificial island in Hong Kong has drawn fierce criticism.

Malaysia has two other major reclamation projects underway: Melaka Gateway, a deep-sea-port and cruise terminal that is part of China’s massive Belt and Road infrastructure plan, and Forest City in Johor near Singapore, aimed at foreign investors.

Large-scale reclamation allows more flexibility in city planning, but also lets governments engage “more ambitiously and aggressively with the business of land-banking,” said Keng-Khoon Ng, a lecturer at UCSI University Kuala Lumpur.

“These island-making projects are designed to boost state coffers. They represent a colossal misappropriation of resources at a time of intensifying housing unaffordability and social injustice,” he said.

But the PSR is needed as Penang has “run out of land”, resulting in ad-hoc developments, fewer economic opportunities, and a shortage of affordable housing, said Eddie Chan, executive director of SRS Consortium, the project developer.

A quarter of residential units will be earmarked for affordable housing in the average price range of 350,000 ringgit, and a fishermen’s taskforce set up by the state government is addressing any social impacts, he said.

“With proper design and construction methods applied to dredging and reclamation, and pollution prevention and mitigation measures to minimise environmental impact, we are confident that reclamation can be done sustainably,” Chan said.

RADICAL RETHINK

The PSR project, designed by Copenhagen-based Bjarke Ingels Group (BIG), is scheduled to break ground in March after approvals.

Reclamation has hugely benefited Penang, with parts of the Bayan Lepas industrial zone, as well as heritage clan jetties built on reclaimed land, said Joshua Woo, a former local councillor.

“There are fancy land reclamation projects for the wealthy, but there are also land reclamation projects for a city’s survival. PSR belongs to the latter group,” he said.

“The project will open up new economic opportunities and social spaces for us,” he added.

In fact, PSR is a “feasible solution” to address urgent environmental issues such as climate change and sea-level rises, said Farizan Darus, chief executive of government agency Penang Infrastructure Corporation that is overseeing the project.

“More than half of Penang island is hilly terrain, therefore the next best approach is land reclamation,” he said.

“Without strategic land, Penang’s growth will be stunted. Now is the best time to implement PSR to provide a much-needed economic boost to Penang, and prepare the state for the post-pandemic economy,” he added.

Meanwhile, an online petition by a local heritage advocate against the project, has garnered more than 115,000 signatures, while a group of residents have held several protests under the Penang Tolak Tambak (Penang Rejects Reclamation) banner.

In building PSR and using it to fund the 46-billion ringgit ($11.4 billion) transport network, the state is taking on a huge financial risk during an economic slowdown, and putting commercial interests above the environment and people, said Teh.

Particularly now, when the coronavirus pandemic has revealed deep-rooted inequalities in urbanisation, authorities should instead favour a “radical rethink on building back better”, she said, including low-carbon public transport networks.

“The government risks putting too much focus on a massively expensive and environmentally destructive project that will only benefit a small group of people at the expense of the wider population during an unprecedented economic crisis,” Teh said.

“Penang may be biting off more than it can chew.”

($1 = 4.03691 Malaysian ringgit)

(Reporting by Rina Chandran in Bangkok, with additional reporting by Beh Lih Yi in Kuala Lumpur; Editing by Astrid Zweynert. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org)

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