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  • Insurance Pricing

    The Algorithmic Insurer

    The insurance industry continues to undergo significant transformation, with new technologies, business models, and competitors entering the market at an increasing rate. To be successful in attracting and retaining the most valuable customers in this environment, insurance companies must become smarter and increase the speed at which they respond to customer demands.

    The other items on this page apply also to the Insurance Industry - financial crime detection and claim managementstress testing, customer relations, and personalized pricing.

    The goal of the Pricing Accelerator in an insurance setting is to dynamically apply a discount to an insurance product based on customers? conversion or retention probabilities. Using the classical logistic regression model in conjunction with other supervised machine learning algorithms to estimate the likelihood that a customer will purchase or renew an insurance product offering, the optimal discount for the premium is estimated. In actual implementations, techniques like constrained regression can be used to guarantee discounts are balanced across genders and age groups, as required by legislation. The model with the best performance is deployed to support real-time price offerings. Model versioning is carefully controlled for auditing purposes.

    Customer Successes

    Where to go to learn more

    • TIBCO Web Site solutions page "The Algorithmic Insurer"
    • Blog, "The Algorithmic Insurer: Liberating and Leveraging Algorithms Ready for The Fourth Industrial Revolution"
    • Webinar Series (completed) The Algorithmic Insurer - In part 1 of our series TIBCO executives and industry experts discuss The Algorithmic Insurer concept, while in part 2, ?Dynamic Pricing ? How AA Ireland Transformed into An Algorithmic Insurer?, we will have a representative from AA Ireland to discuss how their digital transformation journey led to an agile and profitable business by implementing Artificial Intelligence and Machine Learning through a simple software solution from TIBCO.
    • Webinar series, The algorithmic financial services.
    • Accelerator, is a reference architecture and set of standard models that can be applied as part of an insurance premium quoting business process. Based on TIBCO StreamBase and TIBCO Spotfire, it allows insurers to become more algorithmic and take back control over their pricing platform. Reducing the need for expensive black-box applications allows insurers to gain a competitive advantage by building and deploying their own pricing models quickly and easily. Then using the Insight Platform, monitor the performance of those models and make refinements as necessary.
    • Spotfire template within the Pricing Accelerator, download here.

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