JERSEY CITY, N.J., Jan. 28, 2004 — Insurance Services Office, Inc. (ISO) has acquired Quality Planning Corporation (QPC), a San Francisco-based provider of analytic methods for helping auto insurance companies achieve greater rating integrity. Terms were not disclosed.
QPC's proprietary analytic methods significantly reduce premium "leakage" in personal auto insurance by:
- identifying likely rating errors through the Risk:checkSM solution, and
- correcting those errors using the Precision ReunderwritingSM tool.
Incomplete or incorrect information about auto insurance rating — such as driver identity, garage address and distance driven — leads to billions of dollars a year in uncollected premium, according to QPC.
QPC maintains more than 200 different policy-validation databases. Risk:check's pattern analysis flags questionable rating patterns, estimates the probability an actual error will be found and calculates the likely associated premium recovery.
Precision Reunderwriting produces an automated reunderwriting plan tailored to each policy containing potential errors. The Precision Reunderwriting process includes uniquely scripted and dynamic interview guides for customer contact to correct the errors.
QPC President Dr. Daniel Finnegan said he is delighted to become part of the ISO family. "As part of the larger ISO enterprise, QPC can grow and deliver more value to insurers by linking our products to an array of ISO solutions. ISO's sterling reputation and leadership position throughout the property/casualty insurance industry and its vast expertise in managing and delivering data and analytics will significantly strengthen QPC's ability to serve customers," said Finnegan.
Frank J. Coyne, ISO's chairman, president and chief executive officer, hails the acquisition as "an ideal match for ISO." Coyne said QPC's models will be enhanced through access to ISO's vast repository of insurance data and records.
"ISO is focused on delivering high-value analytic methods to the property/casualty industry. QPC will add to ISO's growing suite of analytic methods for the property/casualty industry and complement a number of recent innovations," said Coyne. Among the innovations he cites are ClaimDirectorSM, a claim scoring product; the Underwriting Risk Model (URM), used by insurers and reinsurers to measure and manage underwriting risk; and ISO HomeValueTM, a new replacement cost estimator for personal property.
"The ability to identify and greatly reduce premium leakage — and recover appropriate premium through a statistically sound, validated rating-integrity tool — is a valuable way insurers can boost revenue and create sustainable advantage," ISO's CEO said.
ISO was attracted to QPC because of the company's innovative technology, successful record serving leading auto insurers, and high-quality management. Finnegan and the members of QPC's leadership team bring extensive experience in the areas of insurance underwriting and claims, statistical analysis, quantitative methods, research and technology, according to Coyne.
QPC will remain in San Francisco, operating as a wholly owned ISO subsidiary. Finnegan stressed the transition to ISO ownership would be seamless for existing customers.
Quality Planning Corporation (QPC), the Rating Integrity Solutions Company, was founded in 1985 and is headquartered in San Francisco. QPC is focused exclusively on providing decision integrity solutions to the insurance industry. QPC works with insurance companies to identify areas of significant premium leakage using sophisticated database management, statistical analysis and modeling, customized survey design, and highly targeted customer interaction. For more information, visit www.qualityplanning.com
ISO is a leading source of information, products and services related to property and liability risk. For a broad spectrum of commercial and personal lines of insurance, ISO provides data, analytical and decision-support products; consulting; data processing; and technical, statistical and actuarial services. ISO field services include on-site rating and underwriting services and the evaluation of community loss-mitigation efforts. ISO's products help customers with sales and prospecting, underwriting, rating and quoting, customer management, policy administration, product development, claims administration and fraud detection. ISO's AIR Worldwide subsidiary provides technologies to assess and manage natural and man-made extreme-event risk. Through its ISO Claims Services, Inc. (iiX unit) and Intellicorp subsidiaries, ISO provides motor vehicle reports and criminal-records information and through its AscendantOne unit delivers policy-management and rating solutions. In the United States and around the world, ISO serves insurers, reinsurers, agents, brokers, self-insureds, risk managers, insurance regulators and other government agencies.
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