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How a Real-time Insurance Pricing Strategy Wins: Gore Mutual
March 10, 2022
Key Takeaways from Earnix Excelerate 2021’s Session with Deb UptonReal-time pricing software and advanced analytics capabilities are revolutionizing the insurance industry, making it much easier for insurance companies and brokers to offer clients suitable products at the best prices. Canada’s Gore Mutual Insurance Company has been using Earnix’s real-time pricing and analytics solution for the last three years. At Earnix Excelerate 2021, their VP of Pricing, Deb Upton, shared how Earnix has impacted the way Gore Mutual works with brokers in order to grow their business.
Gore Mutual has been around for over 180 years and is one of Canada’s first property and casualty insurance companies. In recent years, they realized that in order to remain competitive they had to transform from a company held back by legacy technologies and processes to a modern business that is suitable for the digital age. Since they started using Earnix’s real-time analytics capabilities, they have seen their relationships with brokers flourish.
Gore Mutual’s Legacy Insurance Pricing Strategy
In the past, Gore Mutual used an unwieldy manual process to price their commercial insurance policies. The pricing team would create rates and then pass the information to the IT department so that they could rebuild it in the legacy system. This was, as Deb described, “a very painful and lengthy process for every single person. And we were very limited in what pricing changes we could make and how often we could make them.”
This process was time-consuming and inefficient, especially in a dynamic market where changing conditions make it crucial to be able to update models in real-time. The manual process also meant that using advanced analytics was out of the question, putting the company behind their competitors who were leveraging technology and data to improve their own processes.
It became glaringly obvious to the team at Gore Mutual that in order to keep up with the market, they were going to have to make some changes.
Defining the CustomerIn order to determine the best way to integrate technology into their business practices, Gore Mutual had to first define who their customer is and what needs they have. Deb explained that “Gore Mutual is exclusive to the broker or independent agency channel. So we don’t have any direct-to-customer distribution for various strategic reasons.” The question for them, then, became: is their customer the broker or the end-user?
It’s in the best interest of the broker to find the best possible deal for their clients, both in terms of price and the type of coverage they need, so in the eyes of Gore Mutual, the goal is really the same, whether they consider their customer to be the broker or the end user. As Deb put it, “both are our customers, but each of them have different needs and value different parts of the process in different ways.”
Gore Mutual’s aim is to serve the brokers as best they can so that the brokers can, in turn, offer their clients top quality service. It’s all about building and developing relationships and being able to support those relationships by providing the right information at the right time.
How a Real-time Insurance Pricing Strategy & Analytics Help BrokersWhen working with the client, insurance brokers value simple and efficient processes in order to meet their goals of finding the best insurance product at the best prices. In Canada, commercial insurance from both a product and pricing standpoint are unregulated which means that there is a wide variety of products at a huge range of prices. In addition, many commercial insurance policies have to be reviewed and approved by an underwriter before they can be bound. Because of this additional step, consumers understand and expect that it can take a little bit longer to get a price for a commercial insurance policy than it would for personal insurance, but nevertheless today’s consumers do still expect a fast turnaround.
In Gore Mutual’s experience according to Deb, “quote response time is a must to win a quote and it can be an even bigger factor than price. For example, if I have the cheapest quote but I take a week to get back to the broker, I have probably lost that quote as the broker really wants to place the insurance for the client quickly.” With a real-time insurance pricing software strategy in place, Gore Mutual has become much faster and more efficient in their pricing process and are able to provide the brokers with the information they need so that they can get back to their clients quickly.
Canadian insurance brokers tend to shop around for the best deal for their clients, which involves filling out lots of paperwork for each insurer. This is also a time-consuming process that impacts how quickly the broker can get back to the client with product and price. So, as with pricing, they appreciate a quick response, especially if an insurer is going to turn down the business for any reason. This is where internal real-time analytics are very valuable.
As Deb explained, “the ability to provide technical pricing in real-time to either an internal underwriter or directly to the broker has a substantial impact on whether or not we’re actually going to win the business.” There is no time to waste in analyzing potential business to determine if it is relevant to bid for it, and, if so, to offer the best price.
Instead of spending hours poring over data in spreadsheets, they input the information into Earnix and can quickly determine whether the opportunity is relevant and what the price and coverage parameters should be. Not only can Gore Mutual’s brokers make business decisions quickly, but they can also offer their clients the best possible price based on real-time data.
The relationship with the broker is paramount for the insurance company. Being able to provide the broker with fast answers - whether it’s pricing for a specific product or a decision about whether to bid for particular business - is key to providing brokers with the best possible experience and maintaining a strong relationship with them. Gore Mutual has found that Earnix has “really allowed us to significantly improve the experience which helped us to maintain excellent relationships with our brokers.”
Meeting Client NeedsWhile Gore Mutual serves the brokers first, they also have a vested interest in keeping the end users happy. Many Canadians tend to stick with one broker for the long haul, and will often even use the same broker for both personal and commercial use. With Earnix, Gore Mutual can help its brokers process renewals in a timely fashion and offer updated pricing, ensuring that the client experience is seamless.
Not all commercial clients are price sensitive. In many cases they are more concerned with ensuring that they have the appropriate coverage than they are about the price. A lower price might include too high of a deductible or other provisions that don’t reflect the business’ true risk. Earnix allows Gore Mutual to provide relevant quotes for the specific type of products that the clients need. They can also easily provide options, showing how the price changes as the coverage changes and vice versa. This gives the client the full picture and enables them to make decisions about their insurance coverage easily.
“If the pricing is accurate up front, this minimizes the need for future rate increases, which makes for a happy client, a happy broker and a happy insurance company.”–Deb Upton, VP of Pricing, Gore Mutual
Earnix Creates an Insurance Pricing Model Win-Win for EveryoneWhen insuring their company, business owners want steady and predictable pricing for the coverage they require. Brokers aim to meet their clients’ needs, so they, in turn, get the most accurate information as quickly and efficiently as possible. The old way was time-consuming and inefficient, relying on building models manually and having to start from scratch each time a change had to be made.
With access to real-time pricing and analytics, Gore Mutual can supply its brokers with the best product at the best price for their clients.
Watch Deb's full summit session right here.
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