FactFinders
RISK MANAGEMENT - FACTFINDERS
To make better informed underwriting decisions for your clients, we will, in future, be asking for additional risk information. The Factfinder is the simplest means of collecting this. At MBP we have operated a successful 'pilot' involving Factfinders for certain classes of existing business and we are now looking to take this a step further. By highlighting risk detail in this way, we can ultimately deliver a better rate to agents as well as to new and existing policyholders.
Background
As premiums have continued to rise throughout the UK motor insurance market, we have been approached by many of our policyholders who are:
- seeking guidance on how to minimise premiums
- pointing out the measures they have already taken to reduce risk
- looking for information regarding risk management.
Claims experience will always be fundamental and of paramount importance when assessing premium for any fleet. But from an underwriting perspective, are insurers in possession of all material information to truly individually rate each risk ?
Analysis of claims history, over a three or five year period, will always provide intrinsic rating factors and will raise questions regarding exposure, claims frequency and levels of risk management that exist within a fleet. However, underwriters need additional detailed risk information relative to the risk in order for them to make accurate and informed underwriting decisions.
What is a Factfinder ?
A 'Factfinder' is the simplest means of obtaining greater risk information for underwriting purposes. It is a questionnaire, aimed at providing an overview of how a risk operates and the level of risk control practiced. The main identifying features from any motor fleet 'factfind' can be summarised as:
- Operation and Vehicle Use
- Vehicle Management
- Drivers and Driver Management
- Risk Management Techniques.
We use two Factfinders, one for Private/Public Hire Operators with questions specific to that type of business and another, more 'general' form, for all other risks.
Why we use Factfinders
In addition to standard underwriting factors, including claims experience (and/or current No Claims Bonus entitlement) we are seeking to identify and reward those risks who operate 'good practice' within an overall risk management strategy.
We will therefore ensure that risk rating more accurately reflects:
- exposure to risk
- low mileage for risk type
- vehicle maintenance programme
- a stable workforce with positive driver profile
- application of risk management measures.
In addition, Factfinders will enable us to manage higherrisks more easily, make recommendations and suggest improvements as necessary, for the benefit of all.
Benefits of Factfinders
Rather than rely on traditional methods of rating, the use of Factfinders enables us to be more discerning in risk selection and in pricing methodology.
What it means to You
Existing Business - Renewals
We will write to you at least two months prior to renewal in respect of individual fleet risks with a view to:
- obtain a Factfinder
- check the current vehicle schedule
- request a claims experience update from the previous insurer (if applicable).
Upon our receipt of the relevant information, armed with the Factfinder and claims experience analysis, we will be in better position to rate and assess the renewal requirements of each risk.
New Business - Quotations
In addition to your standard submission, a Factfinder accompanying your presentation will allow a quote to be processed subject to all other relevant information being supplied at quotation stage.
For presentations without a Factfinder, we will telephone you to obtain the minimum information needed to provide you with a quotation, pending completion of the enquiry. Should the quotation be accepted and the risk placed with us, we would then require a duly completed Factfinder within 14 days from inception.
Conclusion
Additional risk information will result in better underwriting decisions for your clients. The Factfinder is the simplest and most effective way of collecting the extra details we need.