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Earnix and Dorman Consulting Survey Shows Insurance Companies Invest Significant Effort in Competitive Analysis, but Effectiveness is Questionable
New York, NY – April 10, 2013, Earnix, a leading provider of Integrated Pricing and Customer Analytics software, and Dorman Consulting Associates, a provider of training and consulting services to the property and casualty industry, teamed up to conduct a survey covering competitive analysis practices used by insurance companies in North America.
Survey results are based on responses from over 150 executives and pricing professionals representing insurance carriers from the United States and Canada.
The results show that insurance companies invest significant resources in analyzing their competitors’ moves and rates, but the effectiveness of these efforts is questionable. Respondents rated the overall effectiveness of their competitive analysis effort at an average score of 3 on a scale of 1 to 5. According to the respondents, the top three improvements that would make for a more effective competitive analysis are improved data collection, a more structured process, and better analysis tools.
The effectiveness of competitive analysis is perceived to be higher when the company has a dedicated competitive analysis team, regardless of company size. However, having a dedicated team for competitive analysis is directly correlated with the company size. While 79% of the companies with over $5B in GWP have a dedicated team, the numbers drop down dramatically the smaller the company is.
Other findings of the survey show that a formal process for comparing the company’s rates to competitors’ rates is more common the larger the company is, but only up to a certain point; the largest companies (over $5B GWP) tend to pay less attention to their competitors’ rates.
Large companies also tend to invest more resources in competitive rate analysis and find their effort in this area more effective than small companies do.
The complete survey results can be downloaded from the Earnix website at www.earnix.com/competitive-analysis-survey.
Earnix Integrated Pricing and Customer Analytics software empowers financial services companies to predict customer demand and its impact on business performance, enabling the alignment of pricing and products with changing market dynamics. Earnix combines risk and demand modeling with real-time connectivity to core operational systems, bringing the power of analytic-driven decisions to every customer interaction in any regulatory environment. Leading banks and insurance companies rely on Earnix solutions to optimize the prices of deposits, loans, and policies, delivering greater value to customers and higher returns to shareholders. For more information, visit www.earnix.com.
About Dorman Consulting Associates
Dorman Consulting provides training and consulting services to the property and casualty industry in all P&C areas including both personal and commercial lines. Dorman Consulting’s seminars cover a full range of bottom-line and applicable skills helping carriers to reach growth-oriented decisions to improve their profitability. Clients can benefit from partnering with Dorman Consulting by receiving customized analysis and solutions that will grow their business faster. For more information, visit www.dormanconsulting.com.
Aviv Cohen, VP Marketing