Digital and data sovereignty is a legal construct, but with significant physical implications on the way technology and data assets are implemented and managed. The agenda is driven in part by security, but also political ambitions for digital independence, which can be thought of much like energy independence. Energy supply risks in Europe were exposed by the war between Ukraine and Russia. So too does the EU have concerns about overreliance on technology services by foreign providers, as well as the extent to which they fall under the legal jurisdiction and political influence of their home governments. However, this is not a uniquely European concern, with governments across Asia-Pacific also pushing for sovereignty rules. Sovereignty is a lesser issue in the US, home to the largest software and AI companies, hyperscalers, and with less data privacy legislation.
AWS, Microsoft, Google, Oracle, and other hyperscalers are investing heavily in regional data center footprints to support the resilience and privacy capabilities required of public sector and financial services clients worldwide. It is a logical extension to offer sovereign cloud solutions so that they, their insurance clients, and their mutual partners can operate compliantly in region.
In recent years, the insurance industry has experienced several simple but significant trends that drive investment in data:
•Insurance organizations are increasingly digital and data-dependent. Not only is more data used in processing, but more data is collected and created by them.
•The insights gleaned from that data, and the potential to use that data in advanced analytics and AI, can be a game-changer for insurers.
•Data platform technology (including cloud and the emergence of new AI technologies) are enablers that allow insurers to more highly leverage and monetize their data assets.
•Data and AI are the building blocks for future insurance products and services.
However, the potential of AI at scale has driven a realization that many insurers may not have their data houses in order. Celent’s latest Dimensions surveys and research show that data platforms and management, along with cybersecurity and AI, top the agenda for technology priorities. But the journey to enable AI at scale—and to support a new generation of intelligent insurance products—has become increasingly complex.
