Why is now the time for a more sophisticated approach to pricing and risk selection? Well, a growing number of insurers are improving their performance and grabbing market share at rates that leave the competition in the dust.
How long until it impacts you?
In our 2017 Outlook Report, we highlighted the need to shift the traditional insurance mindset. Today, the focus has become the policyholder as the primary customer (not the agent/broker), and the need to adopt the same methods tech giants use to win customer loyalty. The third principle is understanding the best mechanism to leverage the fundamental building blocks of data and analytics.
What Valen’s ROI study really highlights is what occurs when insurers become experts at how to incorporate analytics into their overall business strategy and decision-making. The exercise quantified 16 workers’ compensation insurers writing $1.76 billion in premium over a five- year period.
For the second consecutive year of running the study, the numbers speak loud and clear:
- 53% higher premiums (2.9X industry average)
- 25% improvement in loss ratios (1.9x industry average)
What do they all have in common? They’ve partnered with Valen to help execute a data- first approach to analytics, as part of an overall business strategy with clearly defined goals. When a model is properly calibrated to achieve measurable outcomes, and is accompanied by a thoughtful approach to integration and implementation, it empowers underwriter performance. Being a data-driven company is a best-practice for better risk selection, pricing and profitability. And it’s a winning formula that helps customers win too.
ABOUT THE AUTHOR:
Kirstin Marr, CMO of Valen Analytics, has a passion for building companies that invent leading-edge technologies to improve customers’ lives and solve the inefficiencies that exist in traditional marketplaces. As the chief brand advocate for Valen Analytics, she helps pave the way for Valen’s clients to lead the innovation initiatives required to compete in today’s marketplace. Before Valen, she ran business-to-business marketing for internet technology pioneer and market leader, ServiceMagic.com (now HomeAdvisor).
Kirstin has a long-standing commitment to philanthropy and community leadership. Most recently, Kirstin is leading the Insurance Careers Movement coalition, a grassroots initiative of more than 850 insurance organizations raising awareness of what insurance has to offer young professionals. She has been involved in several non-profits focused on Science, Technology, Engineering and Mathematics (STEM) education, among other non-profit causes.