For the insurance industry, the General Data Protection Regulation (GDPR) looks set to have a significant long-term impact, affecting areas such as automated decision making, data retention, portability and erasure (to name just a few).
So how should insurers handle the new law? The initial GDPR readiness project is now behind you, leading to the next challenge: adapting your existing processes – and perhaps even your entire business model – to accommodate the new data law framework.
Here’s our take on how to absorb the changes as painlessly as possible, to spot the opportunities offered by the GDPR, and to stay on the right side of the regulator.
GDPR and insurance: the big picture
Spurred on by the publicity surrounding the new law, consumers are becoming more data savvy; they want to know who controls it, what it’s used for and why. Shortly after the arrival of the GDPR, data regulators across Europe reported a sharp rise in the number of public complaints. If this is a taste of things to come, it seems that from now on in, customers may be significantly more likely to take formal action if they feel their data is being misused.
Meanwhile, through a combination of comparison sites and direct online market access, it has never been easier for your customers to switch providers. Insurers who run into problems with the regulator – or who are seen as being non-responsive and untrustworthy when it comes to data are indirectly giving customers a good reason to look elsewhere for coverage.
By contrast, total transparency, user-friendly ways for customers to exercise their data rights and an ‘all-clear’ record with the data regulator can all help to bring new customers on board – and to convince existing policyholders that you are worth sticking with at renewal time.
Overall, this is perhaps the biggest change that the GDPR will bring about in the long term. Rather than viewing data law compliance as a backroom issue, it’s actually a valuable way of building up customer trust – and of strengthening your credentials as a safe pair of hands.