Europe’s insurance industry, with its deep expertise in using data to identify and measure risk, is a perfect example. With €8.5 trillion ($9.477 trillion) of assets under management and 35% of global insurance premiums, European insurers are already world leaders. They have hundreds of years’ experience deriving insights from very large data sets. Data innovation could help develop and sell new risk-management solutions to markets that are hungry for their services.
Such innovations include in-car devices that relay detailed information about driver behavior. These would allow for greater accuracy in measuring the risk of an accident and could be used to encourage safer driving.
Another example is wearable technology, which people use to track important health information and assist medical professionals in suggesting preventative care. Such devices allow for unprecedented risk management and better-designed, more affordable insurance.
As Europe’s insurers collect more and better information from novel data sources, they will be able to fill in the gaps in information that currently make much of the world’s population difficult to insure. Emerging markets today account for 40% of global gross domestic product but only 17% of global insurance premiums. This suggests a tremendous need to assess, transfer and manage risks to human life, health and property—including in the poorer parts of the industrialized world.