Two decades pursuing one goal:
Greater P&C profitability.
A Millennium client wanted to significantly increase the number of Electrical, Heating and Plumbing property inspections in the state of Florida. This presented a challenge because Florida has many seasonal residents and those surveys require an interior inspection, mandating inspectors establish an appointment with the homeowner. This high number of appointment-based orders had the potential to significantly increase turnaround time for the client, potentially creating delays in their underwriting process and resulting in a much higher frequency of incomplete inspections due to unavailability of homeowners for appointments. Millennium was tasked with developing a strategy that would increase agent and homeowner engagement in the inspection process, and consequently increasing the timeliness and completion rate of providing an increased satisfaction level for all parties involved.
To accomplish this objective, Millennium first created an in-house call process specifically for this insurance carrier. After an order was placed, prior to those policies being assigned to an inspector, our customer service team made contact with those homeowners, as well as their agent, on behalf of the carrier. This ensured the policyholder was aware of the inspection requirement before they were contacted by an inspector. This process also allowed Millennium’s staff to help homeowners understand what kind of inspection we were doing and why it was being conducted, as well as ensure the inspector was provided with the best contact phone number for the policyholder.
To increase agent awareness of this service, Millennium management attended a regional agency meeting and presented an overview of the call process. This allowed agents to see how Millennium was interacting with their customers and how this process was improving homeowner engagement throughout the inspection process.
This pre-emptive notification solution greatly improved homeowner engagement and availability, significantly reducing the number of times that homeowners refused an inspection or were unable to schedule a necessary appointment. It allowed underwriters to intervene early in the process in situations where homeowners were resistive to inspections, and because of the increased communication early on in the process, the carrier was able to get the results of inspection back at a much faster rate. Most importantly, this kind of early communication improved the policyholder’s inspection experience, as they now understood the reason behind the inspection, allowing them to prepare themselves and facilitate the required appointment.
The creations of this enhanced call process helped increase the completion rate of appointment-based inspection by over 35%. Due to the proven success of this enhanced call process, many of Millennium’s other clients have adopted it, utilizing our call center and are realizing exceptional results from this service.
Facing increasing losses, the management team of a multi-regional carrier decided that they needed to perform a broad but selective re-underwriting of their homeowners book. While their primary objective was to clean up their portfolio in terms of insurance-to-value (ITV) and pre-existing hazards/conditions, they also needed to ensure the process could:
To meet these demands, the carrier selected Millennium based on our reputation for handling difficult integration issues, our proven workflow management capabilities in ad hoc analytical reporting within MAPS and Millennium’s high-quality property surveys.
In order to prioritize inspections for the appropriate level of underwriting review, and to meet the complicated ImageRight integration objectives of the client, Millennium devised a codification process. That process was driven by the highly configurable Stack Logic® process within MAPS. Since two discrete but similar underwriting processes needed to be supported (one for new business currently being written and another for the re-underwriting initiative), the prioritization and routing of inspections to two separate underwriting organizations also needed to be supported. The resulting structure, as represented in the diagram below, allowed for a unique codification of each completed survey, consisting of policy number, order type (new business versus re-underwriting) and survey results (i.e., did the inspection have any issues and if so what type?), as defined in the client’s Stack Logic configuration.
That structure allowed for work queues to be structured within MAPS that could then be mirrored within the client’s ImageRight implementation. Therefore, the most problematic cases could be directly routed to senior underwriters, modest issues were forwarded to less experienced underwriters and clean surveys were applied directly to the policies, alleviating the need for any underwriter engagement. The efficiency savings provided by MAPS, coupled with the increase in premium generated by the re-underwriting efforts, provided a substantial ROI for the carrier and established a stronger book of business.
Based on their experience working within MAPS, the client decided to fully implement MAPS reporting capabilities, using the program for the recording of underwriting decisions. By having each underwriter apply a disposition code to each inspection, reflecting the underwriter’s decision (e.g., cancel, increase coverage, send condition remediation letter, etc.), the client was able to develop their own inspection program management reports. These reports helped identify potential areas of underwriting inconsistency and potential adverse selection within their agency base, further strengthening both their underwriting organization and their agency oversight.
A carrier was struggling with legacy systems that could not provide detailed insight necessary to take accurate underwriting actions for individual homeowners and dwelling fire policies. Limited visibility meant they often found themselves doing business from a blind alley.
Senior management and personal lines management could merely determine if a policy was in force, cancelled at initial underwriting or non-renewed at expiration. Likewise, it was impossible to know if a policy covered a property that had no hazard or replacement cost issues, or remained in force through efforts to mitigate or remove underwriting concerns. If the policy was cancelled or non-renewed, it was only possible to discern the agency producing the business and the underwriter assigned to the agency. The limited information made in-depth performance analysis of agencies and staff difficult as there was no chronology of actions or record of the underwriting decision rationale.
Adopting Millennium’s Automated Property System (MAPS) enabled the recording of actions and captured the thought process supporting those actions. The possible actions range from no underwriting action taken, to immediate cancellation or non-renewal, to an interaction with the agent and insured to correct deficiencies noted in the Millennium report to retain the policy. The underwriters can use the free-form note area to describe their evaluation of the property and note their logic for the underwriting action.
The client is now able to define the disposition (action) codes for their accounts to align them with their underwriting practices. MAPS supports both macro (company) and micro (agency or underwriter) analysis of underwriting actions.
Our client’s senior management can evaluate actions to better align policy coverage limits with the calculated replacement cost provided by their Millennium report. They can use that data to calculate premium gain or loss due to underwriting actions for the company.
At the same time, personal lines management can use cancellation and non-renewal data in assessment of individual agency performance. The by-policy detail of actions and the underwriting rationale provides a powerful tool for agency management. They can also use the data in performance assessment of staff underwriters.
A longtime Millennium client, named one of the U.S.’s top 100 trustworthy companies by Forbes Magazine, had been writing homeowners insurance since 1945. Their survey strategy historically has been to look primarily at new business and to strategically target specific regions or agencies for profitability improvement with a modest annual budget and limited staff.
Management had taken action to affect insurance to value through annual inflation adjustments, but their homeowners business had been only marginally profitable over several years. The root cause involved losses indicating an aging book of business, with many properties not being seen since they were originally written years ago.
It was time to turn a new page and go about the process of revisiting these properties to understand where there was either premium leakage or potential losses looming. The issue was where to start. With a limited budget and the available personnel, how could our client maximize effectiveness and concentrate their efforts where most deserved?
Enter Millennium PreInspectR®. PreInspectR was developed in response to a growing industry need for increased efficiency and is offered as a value-added feature to our survey customers. By combining a vast assembly of historical inspection data with common property characteristics, and environmental and geospatial data, Millennium created a validated inspection optimization tool that allows our clients to score and rank their inforce books. As a result, they can concentrate survey dollars on properties with either the highest probability of any actionable condition, any major condition, potential premium leakage or a combination of any of the three.
Already taking steps to ensure proper insurance to value, our client focused on Millennium’s major condition model. Starting with three key mature states, the inforce book was scored. From that data, the 10% of properties scoring least favorably were targeted for inspection. The results were that, of this group, 89% were found to have actionable conditions, with 67% of those having major conditions. Their underwriting team now can work with peak efficiency, concentrating on risks that most need their attention.
Where to go next? With these proven results, the entire inforce book of business will be scored. Millennium’s dedicated account management staff is working closely with the personal lines executive team on building a multi-year inspection strategy that balances available underwriting resources and inspection budget dollars with Millennium’s efficient policy management system, MAPS.