ISO Expands Its Predictive Analytics Offerings

With the launch of the environmental module of ISO Risk Analyzer Personal Auto, ISO expanded its offering of analytic decision-support tools in the personal auto insurance line.

ISO Risk Analyzer Personal Auto is a predictive model that helps insurers classify, segment, and price personal auto risks. The analytic tool examines more than 1,200 indicators and predicts expected losses at the policy level by major coverage. The environmental module of the model examines the interactive effects of the traffic environment, including the number and types of businesses in an area, traffic density, driving patterns, and public transportation usage; the natural environment, such as the weather and topographical characteristics of an area; and other factors, such as claim frequency and severity trends by state.

The environmental module is one of several ISO Risk Analyzer Personal Auto modules insurers will be able to use individually or together, depending on their analytic objectives. At this time, 17 insurers are participating in pilot tests to evaluate the environmental module. The other modules under development include the vehicle and driver-history modules. To support the new personal auto model, ISO has begun the regulatory filing process for an optional personal auto rating plan and expects over the coming months to complete the process several states at a time.

"ISO is committed to producing and supporting sophisticated analytic solutions that meet insurers' current and future needs," says ISO chairman, president, and CEO Frank Coyne. "Currently, our ISO Innovative Analytics division is working on several initiatives, including the development of predictive modeling analytics for homeowners and workers' compensation lines of insurance, with more in the pipeline."