New Product Concepts
To meet market demand for relevant products, insurance companies often develop specialized products to expand into new distribution channels. In determining a product design, Chadick suggests considering external factors.
It is important to analyze economic trends, competitor behavior, customer expectations, and regulatory changes when developing successful products. Researching a competitor’s product design can offer valuable insights.
Cabe suggests that in addition to conducting your own research, you can also utilize digital resources. Most of this information is publicly available since insurers are required to disclose certain information to their state department of insurance.
The number of product reporting requirements in states is increasing. Insurers can obtain information from Google or from a state DOI website to facilitate their decision-making process.
Set Claim Reserves
Insurers use statistical modeling to predict certain outcomes, including how much a claim will cost. Each action health block has a claim reserve, and the insurer reports those numbers quarterly for all their policies.
As an actuary, Cabe emphasizes that insurers use statistics to predict outcomes such as future claim payout amounts. Furthermore, insurance rates are determined through rate making and equitable rating plans are developed.
It’s rare, but if we can’t find a comparable product on the market for a new product, then we have to stick our finger in the air. It does not happen often. But when it does, we earn our reputation as conservative.
In Conclusion
For managing product development and risks, insurers have many resources at their disposal including actuaries. They provide their expertise to insurance companies, reinsurance companies, actuarial consultancies, banks, regulatory agencies, rating agencies, and government agencies.
What’s Next?
Be sure to tune into next month’s episode as we continue our discussions with Morgan White Group CEO David White and COO Rick Eaton as they discuss strategies for growing a business.
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What's Next
Make sure to catch our next month's episode as we explore further in conversation with Chad Hogan from Quotit. We'll be exploring the fascinating impact of artificial intelligence on the business landscape.
Thanks for listening to the Insurance Leadership Podcast. Be sure to visit us at
Stay updated on all ILP episodes by following us on LinkedIn, Facebook, and Instagram for news and upcoming episodes.
Leave a Review
If this podcast has made you a better leader, you can help share it by leaving a quick Apple Podcast review. You can visit Apple Podcasts Insurance Leadership Podcast on your iOS device and then go to the “Reviews” section. There, you can leave a star rating or click on “Write a review” to share what you learned from this podcast.
Thank you for sharing!