Multiple times a year, property insurers take a close look at the agencies they work with to identify how to improve the agency-insurer relationship, support agency growth and find patterns the insurer can use to strengthen its business. You can make your next agency review more productive and insightful with data that reveals otherwise hidden patterns.
Let’s explore how this process can work by going through a few scenarios, each of which focuses on a different risk. We’ll start with wildfire risk, which is evolving due to a number of factors, including past forest management practices, climate change and development in wildfire-prone areas. We'll also cover cannabis and earthquake risk.
Consider what you could do with data, by agency, on the number of properties located in a wildfire-prone area along with data, by address, on specific wildfire risk factors.
and use that information to enhance your results.
Let’s shift our focus to another property risk: cannabis. If you’re like most insurers, you don’t want to take on this risk, and you have communicated that to your agents. However, the agents may not receive accurate information from prospective customers and may have no way to independently validate that information.
Or, the agent may not receive notice when business occupancy changes. For example, imagine a strip mall. At the time the owner applied for coverage, the mall housed a hair salon, stationery store, pizza parlor and video game arcade. Two years later, though, a cannabis retailer has replaced the stationery store, but the owner didn’t notify the agent.
Retailers are not the only source of cannabis risk. If you insure farms, you may unknowingly be taking on marijuana growers, and if you insure commercial properties, you could be taking on cannabis processors, whose operations can lead to explosions.
By adding independently validated data on the locations of cannabis businesses to your agency reviews, you can:
Finally, let’s consider earthquake risk. Even if you don’t write earthquake policies, you can benefit from knowing how many properties you insure that are at risk of severe earthquake damage. Major earthquakes often cause fires by rupturing gas lines and downing electrical lines, and they make fires more difficult to fight by blocking access to burning buildings and damaging the infrastructure that provides firefighters with water.1
In most cases, fire following an earthquake is covered by a standard property policy, meaning you could face a large number of high-dollar claims after a major quake. By looking at the address-specific earthquake risk of the properties you insure, by agency, you can:
[1] Pacific Northwest Seismic Network, https://pnsn.org/outreach/earthquakehazards/fire