How Active Risk Management Drives Better Insurance Underwriting
Active risk management aims to reduce loss ratios and premium leakage.
As circumstances change, so do customers' risk scenarios.
Getting a wider view of actual risk means better risk pricing, which benefits loss ratios.
Like regular medical visits, regular check-ins with customers pays off for both insurers and insureds.
Getting a better handle on risk reduces premium leakage, which more than pays for the costs of an active risk management program.
Staying abreast of changing customer risks gives insurers and their representatives opportunities to better match total risk coverage to the customer.
Monitoring changing customer risk allows insurers to better assess which customers are the riskiest.
Comparing insured to peers helps to clarify which events are individual circumstances and which are part of larger trends.
Customers who are negatively affected by active risk management are more likely to leave, while the others may be more likely to remain.
A study shows that identifying previously undiscovered risks could help insurers save billions in premium leakage.