By-peril rating has potential to generate lift for insurersBy Doug Wing | June 15, 2015
Many insurers have significant potential to generate lift by aligning rates more closely with underlying risk levels, according to a recent Verisk analysis of industry rating plan data. Our analysis compared current rating plans and premiums with by-peril rates that are based on the relative risks of each policy across nine perils informed by specific building characteristics.
ISO Risk Analyzer® shows a 61 percent difference between the industry's most overpriced and underpriced risks. The predictive model enables insurers to use the highly refined loss cost relativities to develop a variety of business and pricing strategies.
I'd be delighted to answer any questions about how this predictive model can help lift the profitability and retention of your homeowners insurance book of business. Feel free to email me at Douglas.Wing@iso.com.
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