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EPIC Publications Private
Passenger Automobile Insurance Coverages: An Actuarial Study of
the Frequency and Cost of Claims for the State of Michigan
EPIC Consulting, LLC analyzed automobile insurance data on behalf of the Insurance Institute of Michigan and the Michigan Insurance Coalition. The participating companies write over 70% of the market in the State of Michigan. Seven major coverages were included in the study. In addition, nine perils, or cause of loss, were reviewed for Comprehensive coverage, including Fire, Wind/Hail, Vandalism, Total Theft, Partial Theft, Glass, Flood/Water, Animal Collision and All Other. We found that the nature (i.e., claim frequencies and claim severities) of the private passenger insurance losses is significantly different for each of the seven auto coverages analyzed in this study. The claim losses vary significantly by geographical area within Michigan and these geographical variations are different for each of the seven coverages. As a general rule, geographical areas of high claim frequencies for one coverage are not areas of high claim frequencies for all coverages. Generally, areas of high claim severities for one coverage are not high cost areas for all coverages. Homeowners Insurance Coverages: An Actuarial Study of
the Frequency and Cost of Claims for the State of Michigan
EPIC Consulting, LLC analyzed homeowners insurance data on behalf of the Insurance Institute of Michigan and the Michigan Insurance Coalition. The participating companies write over 60% of the market in the State of Michigan. Four policy forms were included in the study - residential owners, tenants, condominium owners and mobile homeowners. Six perils, or cause of loss, were reviewed, including Fire/Lightning, Wind/Hail, Water/Freezing, Theft, Liability/Medical and Vandalism/All Other. We found that the nature of homeowners insurance losses is significantly different for each of the policy forms, and that the perils have significantly different impact on the losses for those forms. The claims and loss costs vary significantly by geographical areas within Michigan and these geographical variations are different for each of the four coverage forms, and for each of the six perils. Critique of Missouri Department of Insurance Study on Credit-Based Insurance Scores
Our review of “Insurance-Based Credit Scores: Impact on Minority and Low-Income Populations in Missouri” found misleading presentation of results, and insinuations not supported by the study’s analysis. There is nothing in the study to support its implications that credit-based insurance scores will negatively impact coverage availability and affordability in certain areas of Missouri. Credit-Based Insurance Score Study
In the largest and most comprehensive study ever undertaken on the connection between credit history and insurance risk, a team of researchers has found that a consumer’s credit-based insurance score is unquestionably correlated to that consumer’s propensity for auto insurance loss. Even more significantly, the study found that insurance scores are consistently among the most important rating variables used by insurers today. Results of the study were presented June 21, 2003 to the National Association of Insurance Commissioners (NAIC) at the group’s summer meeting in New York. The study, conducted by EPIC Consulting, LLC principals on behalf of the property-casualty insurance industry’s four national trade associations, was based on a countrywide sample of nearly 2.7 million auto insurance policies. By contrast, a recent study by University of Texas researchers examined records equivalent to approximately 150,000 policies in Texas only. Results of the EPIC study are consistent across the country, from state to state and region to region, the actuaries found. |
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Copyright 2004 EPIC Consulting, LLC All Rights Reserved.
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