State of Insurance Rating COVID-19 Weather Report #8

ITC will continue to provide these ongoing weekly weather reports throughout this situation. These reports provide agencies and carriers a general baseline of their operations.

Something is different.

When I look back at March and early April to paint the picture of my feelings at the time, the picture is filled with cold, dark rain clouds. My mind, body, and soul were locked up in fear of that weather.

Today, as I began the process of writing this week’s report, I took a fresh look at my mindset and realized that the picture has drastically changed.

Have I thrown caution to the wind and ventured outside without practicing social distancing? No. Have they announced a vaccine? Not yet.

However, the sun is out. My mind is clear. My soul is hopeful.

Things are not just improving; they are returning to normal. It is just a new normal.

Week of 5/11

This week, quoting and rating volume was 10% below ITC’s baseline rating expectations. A slight decline from last week where it was 9.7% below expectations.

Overall, agent quoting continues to trend upward slowly.

Quoting Performance Week of 5/11 Graph

 

State of Rating by State

Last week we re-analyzed state-by-state differences. We concluded that local, state, and federal shelter-in-place directives had a significant impact on state-by-state rating volumes.

The disparity between states that still have strict lockdown requirements (e.g., California, Illinois, and Washington) and states that do not (e.g., Georgia, Oklahoma, and Texas) is clear.

State

Re-opening Date

Variance from Expectation

Arizona

May 15, 2020

-18%

California

Indefinite

-15%

Georgia

April 30, 2020

8%

Illinois

Indefinite

-33%

Indiana

May 1, 2020

-13%

Nevada

May 9, 2020

-18%

Oklahoma

April 24, 2020

12%

Tennessee

April 29, 2020

5%

Texas

April 30, 2020

-3%

Washington

May 31, 2020

-38%

 

One example is Nevada, which “reopened” during the review period. Prior to the lifting of restrictions, Nevada was 27.4% below expected rating numbers. Nevada improved to 17.5% below expected volumes after the restrictions were lifted, roughly a 30% improvement.

Conclusion: As states continue to re-open, insurance quoting will quickly recover, but they will not return to normal quoting levels for a significant period of time.

The Forecast

ITC predicts that quoting volumes will continue to remain below the expected quote activity settling between 8% and 10% below quoting expectations.

These weekly weather reports started with doom and gloom. Continuous rain in the forecast. The dreariest of outlooks. Those clouds have begun to move away.

We must all find our sunny spot in the COVID-19 pandemic. The improvements we are seeing from agents and carriers have warmed our expectations. We hope this report has helped you as well.

Next Report

Stay tuned as next week’s report will include the following:

  • A recap of this week.
  • Comment below on any other data metrics you want to see in this report series.

Methodology

ITC maintains a regular baseline of expected quoting volume for TurboRater. We also maintain an expectation of submission and traffic upon the Insurance Website Builder, TurboRater for Websites, and TurboRater Rate Engine API platforms. 

We built the baseline on a model that reflects multi-year historical performance, usage of the platform, state demographics, and market conditions using data from ITC’s business intelligence and analytical products.

The margin of error for the agency quoting and rating baseline averages less than 1.5% as calculated daily. The data analysis excludes rates returned without a premium.

The margin of error for the online properties and submission volumes averages less than 5%, as calculated weekly.

All models only attempt to predict Monday through Friday. Agency operations over a weekend have too much variability.

About the Author

Laird Rixford

As CEO, Laird Rixford is responsible for providing strategic direction and leadership for the company. Rixford has a proven executive management track record and has more than 20 years of experience in entrepreneurship and insurance technology. An expert in insurance technology and marketing, Laird is a recognized public speaker and has presented at industry events across the United States.

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State of Insurance Rating COVID-19 Weather Report #9
State of Insurance Rating COVID-19 Weather Report #9

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