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Assign price to risk more accurately with Verisk Roof Age

By Visualize Editor September 1, 2015
Wind and hail represent significant roof-related perils for insurers

Insurer Benefits across Functions

Benefits of Verisk's roof age solution

Wind and hail represent the highest loss cost for the property insurance industry, and the age of a roof is highly correlated with the frequency and severity of claims resulting from those events. So homeowners insurers—especially in wind- and hail-prone regions—understand the importance of knowing the remaining life of a roof. Gaining more accurate insights into a roof’s age will allow insurers to better manage risk for homes with older and even newer roofs.

Validating roof age is both difficult and expensive for the industry due to variations in permit data, limitations of inspections, and unreliable self-reporting from policyholders. That’s led to compromises, such as estimating roof age based on year of construction, an inspector’s visual estimate, or inaccurate information provided by a homeowner. The potential costs of failing to accurately account for roof age in coverage and premium decisions on thousands—if not millions—of properties can hurt an insurer’s profitability. Adverse selection can occur when more properties with older roofs are underpriced relative to competitors using more informed rating decisions.

To help solve this problem, Verisk and BuildFax have partnered to produce a roof age product unmatched in the marketplace—Roof Age. Dave Choe, product manager for Verisk Insurance Solutions, says, “The partnership makes sense because of what each company brings to the table.”

The partnership combines the significant resources of each company to deliver a powerful roof age estimating tool.

BuildFax is the leading source for building permit data, with a roof permit database covering more than 10 million homes. The company excels at collecting and cleaning data from thousands of jurisdictions and continues to add new roof permit records to the Roof Age database.

Verisk has committed a team of data scientists with extensive industry experience to build and continually update a roof age model that complements BuildFax’s roof intelligence with more accurate, nationwide, address-level coverage. The model begins with BuildFax permit data as the foundation and adds layers of diverse proprietary data assets from weather, claims, property, and occupant characteristics to improve its predictive power.

To learn more about Roof Age, ask your Verisk Insurance Solutions account executive or contact product manager Dave Choe at DChoe@verisk.com.