Reason #5: Smooth out ‘hard’ and ‘soft’ periods
Become more stable during all the phases of the market with ESRI (UK)’s Insurance Platform
The insurance cycle
For years, the insurance industry has been plagued by soft periods of price cutting and hard periods of being under capitalised.
ESRI (UK)’s Insurance Platform smoothes out both hard and soft periods to provide both a more stable, competitive and profitable operation. This is because:
- Insurers can choose to target more locations that are inherently less risky and less likely to generate claims
- Insurers have the accurate tools to price risk accordingly, taking into account the precise level of geographical and financial accumulation
- The system can accurately balance the level and mix of re-insurance against the organisation’s accumulated risk, to protect the company’s profitability
Collectively, this enables insurers to target the risks they accept, and therefore use capital more effectively during all phases of the insurance market. The net effect will be to:
- Enable greater quantities of business to be written at all stages in the cycle by selectively targeting locations
- Use the available capital more effectively to support a greater number of profitable policies (which both protects and grows the capital base) whilst also providing a greater degree of resilience during a sustained soft period
- Protect market share by targeting price only where appropriate. This approach links the ESRI (UK) process to in-house, actuarially-generated risk profiles and scores
