NEW YORK, Nov. 9, 1998 — Insurance Services Office, Inc. (ISO) took a major step to enter the market for workers' compensation insurance information by agreeing to acquire an 80-percent interest in Insurance Data Resources, Inc. (IDR).
ISO has an option to purchase the remaining 20-percent interest in a year.
The acquisition of IDR from Beedie Group, LLC, provides a ready-made way for ISO to begin providing workers' compensation information in 27 states where IDR is licensed as an advisory organization or statistical agent. ISO through its new IDR subsidiary will provide a variety of services, which, depending on state law and regulation, will include workers' compensation policy forms; manuals of rules; statistical services; modification factors to calculate workers' compensation rates for individual risks, based on their own loss experience; and consulting services.
Specific terms of the transaction were not disclosed.
IDR serves insurers, state workers' compensation insurance funds, self-insureds, and third-party administrators. ISO provides participants in the property/casualty insurance market a comprehensive array of information for 17 lines of property/casualty insurance, but not workers' compensation.
The acquisition brings ISO — already recognized as a leader in insurance data management, systems and technology — the data systems needed to offer a range of workers' compensation insurance information countrywide. Among those data systems are databases, report systems and associated quality-control systems.
IDR's president, Michael Camilleri, will continue to lead IDR as an ISO subsidiary. IDR's staff of systems professionals and workers' compensation experts will become employees of ISO's IDR subsidiary, which will remain in Boca Raton, Fla.
The acquisition of IDR is the New York-based ISO's most far-reaching initiative in the workers' compensation market. Last year, Florida licensed ISO, as well as IDR and the National Council on Compensation Insurance, as statistical agents for workers' compensation.
"ISO's mission is to be the premier value-added resource for all needed property/casualty information," said Fred R. Marcon, ISO's chairman, president and chief executive officer. "IDR brings us established expertise and fills the major gap in ISO's service offering, namely information about workers' compensation. Insurers now write a substantial portion of commercial lines business on an account or classification basis, so acquiring IDR enhances our value by enabling us to cross all property/casualty lines and be an integrated source of the full range of information that applies to any particular class of risks," he said.
All major U.S. commercial insurers are among ISO's 2,900 insurer customers, and nearly all major commercial insurers sell workers' compensation insurance.
"Combining ISO and IDR is a perfect fit both strategically and operationally," Camilleri said. "When insurers are trying to streamline their operations to cut costs, many will find it economically attractive to deal with a fully integrated provider of statistical services and information for multiple lines. And ISO's entry — through IDR — into workers' compensation will bring customers a new level of choice for IDR's menu of services."