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During a recent quality audit being conducted for a large auto insurer, a question was posed about the lackluster results. After all, severities were down and profitability was good. This was certainly a fair question, and one that is probably pondered throughout the insurance industry.

In this particular case, pricing was the catalyst to being profitable. While this was essentially subsidizing the poor claims handling, it won’t always be the case;  giving way to the need for improved blocking and tackling on the claims front.

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