Insurance Europe has endorsed the verdict of a recent report by EU financial regulator, the European Insurance and Occupational Pensions Authority (EIOPA), which recognises opportunities for both consumers and re/insurers in the use of big data.
The report, which specifically looked at big data analytics in motor and health insurance, also confirmed that potential risks arising from the use of big data have not materialised.
Its conclusions indicate that current protective measures are sufficient and challenge the need for any further regulation, Insurance Europe argued.
“Europe’s insurers welcome the report’s acknowledgement of the vast opportunities that insurers’ use of big data bring for both consumers and our industry,” said William Vidonja, Head of Conduct of Business at Insurance Europe.
“In fact, the availability of a greater volume of data and the use of increasingly sophisticated risk modelling allows insurers to provide consumers with significant benefits, such as products that are better tailored to consumers’ needs, more accurate pricing and better risk prevention,” he continued.
“Europe’s insurers call on EIOPA to continue to monitor developments and engage with the industry on this important topic and, at the same time, abstain from regulatory measures that could hinder innovation and our industry’s ability to compete in a global market.”
Although there is no specific regulation on big data currently in place, many existing EU rules are relevant and applicable to its use in re/insurance, Insurance Europe said, including rules on data privacy, insurance distribution, disclosures, distance marketing and equal treatment, as well as Solvency II governance requirements.
“EIOPA’s report confirms that there is no evidence of exclusion issues for high-risk consumers and acknowledges the existing comprehensive set of EU rules and insurers’ data governance arrangements,” Vidonja added.
“As such, Europe’s insurers believe there is currently no need for further regulatory measures, as there is already effective protection in place to ensure the responsible use of big data analytics and to prevent possible undesirable outcomes.”