Insurance Results Projector

Predictive analytics is the determination of future outcomes (in this case, underwriting outcomes) based on historical data, statistical techniques, and machine learning.

The robustness test (negative test) ensures that the inputs and assumptions in the context of an improper application, e.g. by inappropriate, incorrect or no data input at all, are also recognizable as such and thus no further processing of the results takes place.

A portfolio is a homogeneous group of insurance contracts. As the simplest method, insurance contracts can be clustered based on the main insurance lines. Depending on the business activity, other criteria such as geographical components may be useful for portfolio formation.

On the basis of order books and known acquisition and production costs, industrial companies are able to make relatively reliable estimates of profit forecasts. In contrast, the estimation of claims expenses for insurance companies is subject to significantly higher estimation uncertainty. This is due in particular to the assumption of random risk as a component of underwriting risk by the insurance company. This is because it has been proven that losses occur randomly, at least to a certain extent. In addition to the forecast of expenses for outstanding claims, a risk analysis should be carried out in relation to the expected amounts.

IT-supported progress is currently a strong focus in the insurance industry. In addition to online claims reports, customer apps and cooperation with digital companies, automation using blockchain technology could save a considerable amount of administrative work in the future.

The necessary historical data should be available at the level of the portfolios formed for at least the last 10-20 years.

The actuarial profit and loss statements of the formed portfolios (lines of business - P&L) as well as the number of contracts and the number of claims for the above history.

In addition to the portfolio-related annual rate of price increase in the data history, assumptions must be made with regard to premium growth and the percentage acquisition commission. Our industry experts will do this for you in consultation with you.

Our pricing models include a calculation with alternative assumptions for each portfolio as standard. Additionally there is the possibility of adjusting certain assumptions  in the interactive earnings report (e.g. expected premium growth).