Data mining based underwriting profitability analysis

Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Insurance

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705 7, G06F 1760

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active

059704640

ABSTRACT:
A computer implemented method of underwriting profitability analysis delivers the analytic process to a wide cross section of insurance decision makers. The underwriting profitability analysis system leverages an existing investment in databases and improves underwriting business processes. Data mining techniques are applied to historical policy and claims to extract rules that describe policy holders with homogeneous claim frequency and severity characteristics. These rule sets are used to classify policy holders into distinct risk groups, each with its own set of characteristics, including pure premium. Breaking up a book of business into segments allows identification of sub-populations of policy holders that distinctly deviate from the expected normal pure premium. This identification allow the insurance business analysts to interactively adjust eligibility criteria and examine altered characteristics of the covered segments until satisfactory. The system is implemented on a client server using network centric language technology.

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Gallagher, Cecily, "Risk Classification Aided by New Software Tool,"National Underwriter Property & Casualty Risk Benefits and Management, No. 17, p.19, Apr. 27, 1992.
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Bentley, Trevor, "Mining for Information," Management Accounting-London, vol. 75, No. 6 (Jun. 1997), p.56.

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