US insurers are spending $US10 billion ($9.62 billion) a year – about 9% of their IT budgets – on data and analytics, according to a research study released by the Association for Co-operative Operations Research and Development (ACORD).

The study by the global non-profit standards development body for the insurance and financial services sectors points to the growing awareness of the importance of data and analytics by insurers beyond their traditional use in risk assessment and management.

Some 75% of the companies surveyed plan to boost their spending on analytics, with a significant number identifying game-changing opportunities from the application of “big data” approaches to areas like pricing and fraud detection and prevention.

The study defines analytics as the ability to acquire, standardise, organise and enhance data within and outside the business. Its benefits include promoting consistency for process management and strategy.