Pricing is considered the most cutting-edge aspect of personal lines insurance and as such it is viewed as having a major impact on profitability and performance. With this in mind, personal lines insurers are always looking for new ways to advance pricing strategies, making large investments in this space in order to drive growth and remain competitive in the business.
This is certainly true in recent years as the use of innovative tools and techniques such as machine-based learning, AI, data analytics and dynamic products has really taken off, pushing the market into a period of great opportunity. But with this opportunity come even greater challenges. Firms face the pressure of launching such innovations under regulatory scrutiny, as well as a race to keep pace, fearing the heavy prices to pay for falling behind.