Issue:

The customer wanted to reevaluate its underwriting practices and the use of discretionary discounts.

Analysis:

Using Millbrook's tools, the customer analyzed underwriting loss ratio by discretionary credits and experience modifications.  Underwriters in direct contradiction to company policy had been issuing credits to offset policies with bad experience.

Solution:

The offset crediting was eliminated and within the next two years it resulted in a small decrease in policy count with significant increase in average premium.  The company's exposure decreased while premium and profitability increased.

Result:

Analysis of the relationship between modification factors and discretionary debits and credits resulted in more than 20% increase to inforce premium, more than 30% increase to average premium, and more than 30% decrease to loss ratio over a two-year period.

Issue:

The customer wanted to reduce the average caseload by examiner.

Analysis:

Using Millbrook's tools, the customer analyzed open cases to find a significant number that were inactive and/or eligible to be closed.

Solution:

The customer identified cases with large reserves yet no financial activity for an extended period. The customer also identified cases with outstanding reserves that had payments that had exceeded their statutory requirement. Within a year, the customer closed a significant number of cases and lowered their loss reserves, resulting in a positive change to their balance sheet.

Result:

Analysis of open cases, with outstanding reserves and no financial activity for an extended period, resulted in closing more than 12% of all open cases in the first year. Similar analysis of open cases with outstanding reserves and payments that exceeded their statutory requirement resulted in closing additional open cases. Open case loads and total outstanding reserves were both reduced by more than 35% over three years.

Issue:

The customer had been experiencing minimal growth each year as they continued to write business that followed industry norms. Despite their competitive attempts, their results were producing only marginal growth and profits.

Analysis:

Using Millbrook's tools, the customer analyzed their performance trends by market segment, geography, product, and coverage. Their historical loss and profit trends showed their best results were in areas they had previously avoided, as they followed industry norms.

Solution:

The customer reoriented their focus to write more business in this profitable area, and discontinued following their competition's efforts. Within the first year, their revenue and profits increased. Within three years, their size had doubled with their highest profits ever.

Result:

Analysis of profitability by market segment, geography, product, and coverage resulted in up to 30% annual increases in revenue and up to 3% annual reduction in loss ratio.

Issue:

The customer experienced a small decrease in renewal retention and a more significant decrease in premium. They were concerned that they may need to increase rates.

Analysis:

Using Millbrook's tools, the customer analyzed the business that was non-renewing. They discovered that a large percentage of the non-renews were seasoned, loss-free policies.

Solution:

The customer created a renewal discount program that provided loss-free and longevity credits. Within the next year, they raised their retention rates and significantly increased inforce policy counts and premium without a rate increase.

Result:

Analysis of renewal retention and profitability resulted in more than 5% increase in inforce premium and more than 3% decrease in loss ratio.

Issue:

The customer experienced higher than normal losses, with no clear indication of the cause. The CEO needed to prepare an explanation for an upcoming Board meeting.

Analysis:

Using Millbrook's tools, the CEO analyzed the recent losses against historical trends. He quickly determined that one segment of the business had increased losses by more than half since the prior year. Initial analysis of the segment showed no apparent outliers by geography or agent. He then eliminated smaller claims and a pattern emerged.

Solution:

The CEO was able to clearly identify a small number of seasoned, virtually loss-free policies that experienced unanticipated severity. His findings were shared with the Board and with national rating agencies to explain the company's financial situation.

Result:

Customers have avoided negative changes to their rating by identifying severity experience and sharing findings with national rating agencies. Analysis and identification of frequency and severity experiences by market segment, geography, product, coverage, production unit, and underwriter helped customers improve underwriting policy, risk selection, and performance.

Issue:

The customer wanted to use their Actuarial models at more detailed levels to refine their reserving practices.

Analysis:

Using Millbrook's tools, the customer was able to feed more detailed level information to their Actuarial models.

Solution:

The customer was able to distinguish between actuarial trends and outliers, resulting in a fine-tuning of reserve adequacy and claims practices. Changes were made to claims departmental reserving practices that resulted in improved accuracy.

Result:

Actuarial analysis of loss development and experience at more detailed levels resulted in improved reserve adequacy, ongoing case management improvements, and reduced total outstanding reserves.

Issue:

The customer needed to respond to their annual reinsurance questionnaire and faced a possible exclusion or reduction in capacity. They had historically paid a premium penalty for full capacity.

Analysis:

Using Millbrook's tools, the customer produced detailed breakdown to the reinsurance questions.

Solution:

The customer was able to show the reinsurer they met the qualifications for full capacity without any premium penalty. This resulted in a significant savings in reinsurance costs from previous years.

Result:

Customers have received the required capacity, enabling them to meet their revenue targets, while saving $100,000 annually in reinsurance costs by providing information that is more detailed to their reinsurers.

Issue:

The customer wanted to reduce the lengthy financial analysis required each month to close.

Analysis:

Using Millbrook's tools, the customer produced all of its financial reports and was able to proactively prepare explanations for the results.

Solution:

The closing process was reduced significantly. Detailed explanations for the results were also provided for all questions that arose.

Result:

Customers have reduced their closing cycle and monthly financial analysis period by more than 80% while providing a more in depth analysis. This analysis enables the various departmental managers to address budgetary issues in a productive way.