Intelligent vehicle insurance pricing management system solutions

Scheme background

Since the implementation of deepening reform of the rate management system for commercial vehicle insurance terms in June 2015, the independent pricing right of insurance companies has been gradually expanded. On April 3, 2018, CBRC and CIRC issued Notice on the Development of the Pilot Reform of Independent Pricing of Commercial Vehicle Insurance, which defined that Shaanxi, Guangxi and Qinghai provinces fully liberalized their independent pricing fluctuation ranges, and declared that the full liberalization of independent discount was the ultimate mode of tax reform, the pricing right would be completely left to the market. The revolutionary promotion of rate marketization puts forward higher requirements for enterprises’ accurate pricing and scientific allocation of cost resources. It can be foreseeable that the precise pricing, differentiated resource allocation capability and supporting technical tools will become the core competitiveness and healthy development weapon of insurance companies in the vehicle insurance market. The conventional vehicle insurance pricing model of insurance company is formulated by actuarial department based on various risk factors, and the generalized linear model is used to calculate the rate adjustment coefficient of each pricing factor as the basis for pricing the vehicle insurance. During the insurance underwriting and pricing, the business management department will, on the basis of actuarial pricing, consider the operating budget, market competition, and correct actuarial pricing deviation, etc. by using the simple computing procedure to make the underwriting and pricing, which periodically satisfies the underwriting and pricing requirements of tax reform in the initial stage. However, the above model has gradually exposed some problems, such as the hysteresis of actuarial pricing to market response, and the insufficiency or lack of support in operation, block computing integrity, cost linkage calculation and rigid execution of simple underwriting calculating program. In order to better implement the vehicle insurance underwriting and pricing management, supplement the actuarial pricing more scientifically, improve the underwriting decision management efficiency and accuracy, and further enhance the sophisticated and differentiated management capability of underwriting and pricing, a complete set of scientific underwriting and pricing management system and implementation tools should be constructed to provide powerful mechanism guidance and system support for accurate pricing.

Scheme content

Chinasoft International intelligent vehicle insurance pricing management system is a kind of intelligent management system integrating the pricing strategy formulation, release, backtracking, and business analysis. Through the introduction of an intelligent risk analysis model combining internal and external data, the pricing strategy management is optimized, and an evaluation-backtracking underwriting and pricing system based on risk premium is established to form a unified business quality evaluation standard in insurance companies, which provides a solid foundation for the improvement of insurance companies’ accurate pricing capability. Intelligent vehicle insurance underwriting and pricing model: by taking into full consideration many factors such as regulation, business objectives, business segments, channels and insurance types, we use the data mining algorithm and recommend the best solution of independent coefficient and market expense ratio for different client groups to assist the pricing decisions. Intelligent underwriting and pricing calculation and simulation: implement the intelligent underwriting and pricing model according to the setting conditions to output the simulated data of anticipated pricing and business results; meanwhile, support the system users to customize the pricing strategy based on the business classification, to calculate and simulate the underwriting and pricing. Implementation of intelligent underwriting and pricing: two ways to dock with the core system are provided: (I) to output the underwriting pricing results one by one through service invocation, (II) to use the data exchange synchronous pricing strategy configuration, transform the underwriting and pricing rules through manual writing, and support the one-by-one pricing through the rule engine. Data acquisition and analysis: establish the configurable business dimension/indicator library to realize the configurable and multi-dimensional business analysis management, and present technology by using various visual charts to assist the business analysis. Underwriting and pricing strategy backtracking and warning: realize the comparison analysis on actual business results, business objectives and pricing strategies, detect the deviation between business results and expected values, give early warning to abnormal indicators, and continuously monitor and follow up the treatment of abnormal indicators.

Scheme value

Chinasoft International intelligent vehicle insurance pricing management system solutions aim to provide a set of perfect and scientific underwriting and pricing management tool for the vehicle insurance department of the insurance company through the vehicle insurance business objective management, smart pricing management, business analysis management, pricing strategy output and smart pricing backtracking functions in the intelligent recommended pricing strategy platform. The value of the scheme is mainly reflected in: introducing internal risk factors and external big data risk factors of insurance companies to form a richer pool of risk factors and provide plentiful data foundation for accurate pricing; establishing a flexible multi-dimensional business analysis framework based on the wide pricing table to support the multi-dimensional and flexible customized partition and the flexible customized warning rules, so as to satisfy the user’s personalized analysis demands; the system provides the intelligent optimal recommendation of underwriting and pricing strategies based on different business strategies to supply scientific reference in price making for underwriting business personnel; the system provides the function of pricing strategy monitoring and backtracking, which will give the early warning to poor pricing strategy, and promote the continuous improvement and perfection of intelligent pricing strategy; the system realizes the quasi-real-time docking function of pricing strategy, and the execution of pricing strategy can reflect the actual situation of vehicle insurance market in a more timely manner.