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Verisk Analytics Announces ISO Risk Analyzer Personal Auto Vehicle Module
JERSEY
CITY, N.J., October 3, 2011 (GLOBE NEWSWIRE) — Verisk Analytics
(Nasdaq:VRSK) announced today a new addition to the ISO Risk Analyzer®
suite of predictive modeling tools for more accurate pricing of physical damage coverages for personal autos.
The
ISO Risk Analyzer Personal Auto Vehicle Module is a powerful analytic
tool that uses vehicle characteristics to predict collision and
comprehensive losses at a highly refined level. The vehicle module
represents a significant evolution in the refinement and accuracy of
vehicle Symbols and vehicle rating.
“For
decades, Verisk’s ISO subsidiary has provided industry-leading tools to
understand how the car a person drives affects insurance risk. ISO is
now revolutionizing these tools with the introduction of powerful
analytical methods and extensive data on vehicle characteristics. The
vehicle module will provide unparalleled information to insurers about
vehicle risk,” said Kevin Thompson, senior vice president of Insurance
Services at ISO.
The
vehicle module contains two levels of output — ISO Risk Analyzer
Personal Auto Symbols and more detailed component-level output.
ISO Risk Analyzer Personal Auto Symbols
ISO
Risk Analyzer Personal Auto Symbols provide more than 400 uniquely
defined Symbols and corresponding rating relativities for comprehensive
and collision coverage. The new Symbols are two characters in length,
composed of a “price new” character and a “vehicle attribute” character.
ISO derives the ISO Risk Analyzer Personal Auto Symbols using
individual vehicle attributes, such as body style, and performance and
safety features, as well as information related to the manufacturer’s
suggested retail price (MSRP). The new Symbols represent the combined
predictive power of hundreds of vehicle characteristics distilled into a
compact symbol representation.
“ISO
Risk Analyzer Personal Auto Symbols are significantly more granular
than ISO’s current Symbols, in part due to the more refined treatment of
vehicle series and the use of actual vehicle characteristics in the
modeling. ISO Risk Analyzer Personal Auto Symbols bring the power of
predictive analytics to physical damage vehicle rating and allow you to
easily enhance your vehicle rate-segmentation capability,” said John
Kollar, vice president of Personal Lines, Increased Limits, and Rating
Plans at ISO.
ISO
plans to file ISO Risk Analyzer Personal Auto Symbols with insurance
regulators in most states. The filings will introduce an alternative
rating rule that insurers may license and adopt.
ISO Risk Analyzer Personal Auto Vehicle Module Output
In
addition to the ISO Risk Analyzer Personal Auto Vehicle Symbols, the
vehicle module provides outputs to aid insurers in their loss prediction
and internal modeling. Module output consists of loss relativities and
components, with separate frequency and severity models built by
coverage for collision and comprehensive. Comprehensive coverage is also
modeled by peril.
For
each coverage, the set of relativities provides loss indications for
the three major facets of each model: price new (or MSRP), model year,
and vehicle characteristics. The relativities can be used in conjunction
with the new Symbols to provide refined estimates of insured losses.
Components
are groupings of input variables constructed from VIN information and a
number of data sources. They represent powerful combinations of
specific loss-related vehicle attributes. The components can be thought
of as “super variables” that an insurer can use directly as inputs in
their own predictive modeling efforts.
“One
of the best things about how we have constructed the product is that
you can use the output of the vehicle module as stand-alone analytics to
help classify, segment, and price your vehicle physical damage risks
with confidence,” said David Cummings, vice president and chief actuary
of ISO Innovative Analytics. “Or you can use the components as input to
jump-start your own customized model, taking advantage of ISO’s
extensive data acquisition, preparation, and variable selection work
that is necessary to build a reliable model.”
About ISO
Since 1971, ISO has been a leading source of information about
property/casualty insurance risk. For a broad spectrum of commercial and
personal lines of insurance, the company provides statistical,
actuarial, underwriting, and claims information; policy language;
information about specific locations; fraud-identification tools; and
technical services. ISO serves insurers, reinsurers, agents and brokers,
insurance regulators, risk managers, and other participants in the
property/casualty insurance marketplace. ISO is a member of the Verisk
Insurance Solutions group at Verisk Analytics. For more information,
visit www.iso.com and www.verisk.com.
About Verisk Analytics
Verisk Analytics (Nasdaq:VRSK) is a leading provider of information
about risk to professionals in insurance, healthcare, mortgage,
government, and risk management. Using advanced technologies to collect
and analyze billions of records, Verisk Analytics draws on vast industry
expertise and unique proprietary data sets to provide predictive
analytics and decision-support solutions in fraud prevention, actuarial
science, insurance coverages, fire protection, catastrophe and weather
risk, data management, and many other fields. In the United States and
around the world, Verisk Analytics helps customers protect people,
property, and financial assets. For more information, visit www.verisk.com.
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