It is critical for insurers to stay up to date with ISO loss costs, new product forms and regulatory changes contained in the thousands of circulars issued by ISO each year. The updates help insurers keep their existing products current with market trends and bring new products rapidly into the market to meet producer and policyholder demands. Insurers find the manual method of ISO adoption acutely insufficient for maintaining their products and remain compliant with regulators. A solution that automates and streamlines ISO adoption is the need of the hour for insurers.
ISO ERC revolutionized the way ISO is adopted
ISO launched ISO Electronic Rating Content™ (ERC) to help insurers overcome the challenges. ISO ERC provides insurers the ability to import ISO changes in electronic format, which significantly speeds up ISO adoption. The content presents ISO’s own interpretation of circulars and includes complete loss costs information, rates and rules for most commercial lines.
In a recent webinar, Mark Sheehan, AVP, ISO Rating Solutions stated that with ISO ERC, insurers can implement ISO changes in just three steps - receive circulars, apply company specific deviations and apply changes in the system. Mark stated that the analysis and implementation phases of the traditional method that constitutes 70% of the total effort, have already been taken care of by ISO in ISO ERC. As a result, insurers have more time to focus on building their company specific deviations rather than spending time on implementation.
Adopt ISO changes with just a few clicks
A modern rating engine can help insurers import and fully leverage ISO changes with just a few clicks. By enabling ISO Electronic Rating Content in a modern rating solution, insurers can automate their rate or rule making processes, reduce operational costs, accelerate product development and maintenance. Insurers have two broad rating engine options to leverage ISO Electronic Rating Content:
- A custom rating system that can leverage ISO Electronic Rating Content
- A commercial off-the-shelf rating system from a vendor, who is a member of the ISO Electronic Rating Content Associate Program
Key features of modern rating engine with support for ISO ERC
Regardless of the option insurers choose, the rating engine must have a few key features to fully leverage the power of ISO ERC. A modern rating engine with support for ISO ERC should:
- Fully automate the consumption of ISO Electronic Rating Content without any manual effort. Any manual effort would defeat the purpose and may re-introduce errors, increase time and costs to stay up-to-date.
- Provide a rich library of ISO ERC rate plans out-of-the box for multiple lines of business available via integration of ISO Electronic Rating Content.
- Insurers should be able to easily deviate ISO definition and create proprietary coverages, rates and rules.
- Provide insurers the ability to define and build complex business logic using the rating engine without any programming effort.
- Have sophisticated change management capabilities that help insurers identify changes between their current rates and proposed ISO changes to help with the decision making process by visually describing impact of such change to their book of business. Insurers can thus take informed decision whether or not to deploy, deviate or decline a change.
- Be able to track entire history of a change along with an audit trail.
- Be able to seamlessly integrate with other systems like policy management, agent portal or quoting system.
In order to stay competitive, insurers offer unique products based on ISO to improve profitability and bring product changes to market with speed and accuracy. Leveraging ISO Electronic Rating Content in combination with a modern rating engine, insurers can transform the way products can be developed and maintained.
You can watch Mark Sheehan, AVP, ISO Rating Solutions presenting in a recent webinar on how ISO ERC can help insurers implement ISO updates efficiently.
You can watch the complete recording of Mark Sheehan's presentation by clicking the below on-demand webinar You can now update ISO rating content digitally. You will also view how ValueMomentum’s iFoundry rating engine with ISO ERC has helped insurers deploy products based on ISO as well as ISO accommodation lines in 30% of the time it would take to implement manually.