Auto Insurers Can Now Validate Rating Information at Point of Sale

Market Wire, April, 2008

Auto insurers focused on eliminating rating errors introduced during the sales process now have a new weapon to identify inaccurate or fraudulent information. In a move that places advanced data analytics techniques on the front line of auto insurance sales, Quality Planning Corporation (QPC) is introducing QPConfirm®.

QPConfirm works in conjunction with an insurer's existing sales process and systems to flag questionable policyholder information when it is first provided. During the new business application process, QPConfirm reviews select rating elements, such as annual mileage, commute distance, and business use for accuracy, currency, and legitimacy. Within seconds, the new-account representative (or, in some instances, the underwriter) receives an analysis of the reviewed data that highlights potentially flawed, false, or incorrect policyholder information.

QPConfirm works in real time, uncovering costly insurance premium rating anomalies by comparing rating information provided at the point of sale with QPC's proprietary analytics and databases, and other independent data sources.

"QPC's unique approach to validation of customer data at the point of sale uses a real-time application of sophisticated database matching, statistical analysis, and data modeling to identify and recover auto premium leakage," said Bob U'Ren, senior vice president of underwriting and business development at QPC. "This enables auto insurers to focus on specific, high-recovery objectives, determine premiums appropriate to the risks they are assuming, and create sustainable competitive advantage."

A recent study (1) conducted by QPC revealed that a substantial number of rating errors are introduced during the sales process. QPC's research revealed that underwriting new customers without conducting thorough audits is risky -- and potentially costly. Quite often, the initial rating information is suspect and will result in an underpriced policy at best, and quite likely in losses that eliminate any possibility of first-year profitability. QPC's audits have shown that new business booked at inadequate rates costs auto insurers hundreds of millions of dollars each year. The primary cause of the inadequacy is non-verified information that is false, dated, or incomplete.

Until now, those errors were hard to detect and remained invisible until a rigorous check of policy information was conducted 6 to 12 months later. By placing sophisticated rating integrity technology at the front end of the customer life cycle, insurers can realize the following benefits:

--  accurate initial pricing;
--  early identification of true risk;
--  improved rating integrity;
--  significant premium uplift;
--  lower loss and combined ratios.
    

QPConfirm is available to companies of all sizes and in all states. For additional information, contact Mike West at 415-268-8643 or visit www.qualityplanning.com .

About Quality Planning Corporation

An ISO business, QPC is focused exclusively on providing rating integrity solutions to auto insurers. 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. QPC helps clients maximize revenues from existing rating plans and charge fair prices to policyholders based on a true representation of risk. QPC was founded in 1985 and is headquartered in San Francisco. For more information, visit www.qualityplanning.com .

About ISO

A leading source of information about risk, ISO provides data, analytics, and decision-support services to professionals in many fields, including insurance, finance, real estate, health services, government, human resources, and risk management. Using advanced technologies to collect, analyze, develop, and deliver information, ISO helps customers evaluate and manage risk. The company draws on vast expertise in actuarial science, insurance coverages, fire protection, fraud prevention, catastrophe and weather risk, predictive modeling, data management, economic forecasting, social and technological trends, and many other fields. To meet the needs of diverse clients, ISO employs an experienced staff of business and technical specialists, analysts, and certified professionals. In the United States and around the world, ISO helps customers protect people, property, and financial assets. For more information, visit www.iso.com .

(1) Getting Off to a Clean Start: Why Point-of-Sale Verification Improves Pricing Accuracy. Quality Planning Corporation, April 2008. (This white paper is available at www.qualityplanning.com )

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Contact: Tim Cox Zing Public Relations 650-369-7784 Email Contact