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View Poll Results: How do you rate Homeowners Insurance?
By Peril 4 50.00%
By Coverage 0 0%
By Peril and Coverage 1 12.50%
Neither 1 12.50%
42 2 25.00%
Voters: 8. You may not vote on this poll

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  #1  
Old 02-01-2018, 05:15 PM
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Default How do you rate Homeowners?

By Peril - Rates independently determined for each peril (wind, water, theft, etc.)
By Coverage - Rates independently determined for each coverage (A-building, B-other structures, C-contents, D-loss of use, E-liability, F-medical)
By Peril and by Coverage - Independent rates for combinations of perils and coverage (Fire-Building, Fire-Contents, Wind-Building, etc.)


We're looking at redesigning our rating and data storage systems and are interested to see which approach is preferred in the industry.
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Old 02-01-2018, 05:18 PM
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Quote:
Originally Posted by coinfootball View Post
By Peril - Rates independently determined for each peril (wind, water, theft, etc.)
By Coverage - Rates independently determined for each coverage (A-building, B-other structures, C-contents, D-loss of use, E-liability, F-medical)
By Peril and by Coverage - Independent rates for combinations of perils and coverage (Fire-Building, Fire-Contents, Wind-Building, etc.)


We're looking at redesigning our rating and data storage systems and are interested to see what approach is preferred in the industry.
Depends on the state. A state like FL will be both. Small states is all perils lumped together or maybe just split out Wind and then slight adjustments around contents specifics.
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Old 02-01-2018, 05:49 PM
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Our Current System:

Coverage A can vary. Coverages B-F are either a fixed $ amount or a fixed % of Coverage A. Rating is then done By Peril for all coverages combined. We have no ability to increase/decrease rates or vary factors for individual coverages.

Would rating by peril and by coverage provide incremental value?
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Old 02-01-2018, 05:55 PM
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Originally Posted by coinfootball View Post
Our Current System:

Coverage A can vary. Coverages B-F are either a fixed $ amount or a fixed % of Coverage A. Rating is then done By Peril for all coverages combined. We have no ability to increase/decrease rates or vary factors for individual coverages.

Would rating by peril and by coverage provide incremental value?
Depends on how much you do in states where it matters a lot. It just adds an extra level of sophistication like any other rating factor, although as an extra dimension. For example wind mitigation features likely don't improve your theft risk despite having a meaningful impact to your hurricane risk. You can get much more targeted with these sorts of discounts when you're split peril.

NY RCC is another fun example. Wouldn't want to lump that all into one peril if you have the option.
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Old 02-01-2018, 05:59 PM
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Do you account for price sensitivity at the end?
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Old 02-01-2018, 06:01 PM
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Do you account for price sensitivity at the end?
You mean applying u/w mods?
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Old 02-01-2018, 06:31 PM
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. It just adds an extra level of sophistication like any other rating factor, although as an extra dimension. For example wind mitigation features likely don't improve your theft risk despite having a meaningful impact to your hurricane risk. You can get much more targeted with these sorts of discounts when you're split peril.
Do you feel that the same advantages exist for rating by coverage? For example, roof type may impact the building (cov A) but have very little impact on contents (cov C).

We plan to continue rating by Peril.
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