Even during periods of relative economic placidity, finding pockets of opportunity for insurance market expansion or retrenchment can be a challenge. During a moment of nearly unprecedented economic instability and record unemployment, it can seem like an exercise in futility.
But with the right data and analytical tools, it doesn’t have to be.
For almost a decade, Assured Research has helped their clients better understand the demand for property and casualty insurance products, finding “jet streams” of economic opportunity while navigating around potential “tornadoes” of falling demand through subscriber-only research and analysis. In that time, the company has leveraged ISO MarketStance as one of the critical data inputs to inform its analysis.
In its most recent research, Assured Research utilized ISO MarketStance, among other sources, to analyze the outlook for three critical coverage areas and the exposure units that drive premiums: liability insurance and sales, workers compensation and payrolls, and property premiums and operating locations.
The firm began its analysis of U.S. industries at the two-digit NAICS code level to see which had a strong deviation between their historic growth and their forecasted growth inside ISO MarketStance. Once those divergences were identified, Assured zoomed into the 6-digit NAICS class level to locate specific industry niches that would be most “actionable” to insurers and their distribution partners. At this more granular level, Assured could identify businesses in different industry classes that were either at acute risk of decline or those that could serve as (relatively) safe havens.
This exercise not only teased out critical trends in a number of industries and coverages, but underscored the value of having access to granular economic and insurance data sets when engaging in strategic forecasting and planning. Case in point: While the ISO MarketStance Commercial Lines Forecast July Update projects a 2.8 percent decline in commercial lines direct written premiums, not every coverage/industry segment will see steep losses—indeed, some are projected to grow. It’s all about recognizing and riding those jet streams as much as possible.