The nonstandard auto insurance market is being redefined by the influence of technology and other external forces, according to a new study by Conning Research and Consulting.
“As predictive modeling has become more prevalent in auto insurance underwriting, the standard auto market has expanded to include and price risks that would once have been thought of as nonstandard,” said Alan Dobbins, analyst at Conning Research & Consulting. “As a result, the new nonstandard market is undergoing a dramatic shift in risk profile.”
The Conning Research study, “The Nonstandard Auto Insurance Market: Evolutionary Challenges,” reviews the recent history and performance of this market, and explores the forces shaping change in the segment.
“In addition to the effect of predictive modeling use in both standard
and nonstandard markets, our analysis indicates increased competitive pressures in nonstandard auto and likely significant near-term consolidation,” said Stephan Christiansen, director of research at Conning.
“Management focus and experience has always been critical in the
nonstandard auto insurance market due to the higher risk profile inherent in the business. Now, however, management will need a new set of tools to aid in risk management.”
Source: Conning Research & Consulting
www.conningresearch.com
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