| Author |
 Topic  |
|
|
CCarr
Canada
1200 Posts |
 Posted - 05/21/2003 : 23:44:55
|
I have done a lot of replacement cost evaluations over the years for underwriting purposes and for claims, and have seen their use and value many times over the years; both from an insurance to value (ITV) basis, for loss settlement purposes, and for loss control purposes.
I never thought a "walk through" and a detailed assessment of value and risk by a person, with the proper current data entered into a software program, could ever be replaced by a simple few key strokes.
"The Bluebook International Inc announced the availability of InsureBASE(TM), an automated residential property information solution .... By simply entering a property's address and zip code, InsureBASE(TM) will quickly provide replacement costs for residential properties accurate to a city block including current market value, property characteristics and an array of neighbourhood and other underwriting information ...."
The full article can be read at the following link.
http://www.insurancejournal.com/news/newswire/national/2003/05/21/29146.htm
Unrelated but similar, MS/B had a news release on 5/20 concerning their upcoming 17th annual Client Conference. "Industry experts will discuss the value of connecting ITV (insurance to value) initiatives with claims processes to improve property carriers profitability .... Conference topics also include the value of data elements, the impact of better insurable values and how claims settlement data can bring value to underwriting decisions ...."
Similar "tools" are making negative news in the casualty claims sector, where injury information is data entered for computer model assessment. That used to be an adjuster's job. |
Edited by - CCarr on 05/21/2003 23:50:15 |
|
|
Jgoodman
USA
9 Posts |
Posted - 05/22/2003 : 09:25:49
|
Is this a bad thing?
This is to be marketed to the underwriting departments or agents. In my experience, which I admit is less than some other around here, it would be good for the agents and underwriters to know what municipality thinks a structure at an address is worth. Especially if the result is correctly insuring to value.
Especially if one is working residential flood claims; every homeowners wants to recover their depreciation. For that to happen a structure must be insured to 80% of value, among other things.
Here in VA, the local tax appraisal of a address is available on-line for anyone that chooses to look. It sounds as if this program culls that data, and other sources, and stores it for easier retrieval. It is probably based on whatever it is the municipality bases its tax rates. It probably does not take into account improvements or the state of disrepair of an individual structure. That would take an actual inspection to determine. I am reasonably sure that these folks have not inspected every address in the US.
Since Microsoft is mentioned so prominently, (they are launching this from the MS booth) you can be sure that this is based on the most recent MS technology. This means that it may not work reliably until the first service pack is released. It certainly means that it will cost a fortune and only the carriers will be able to afford it.
I myself have done underwriting reviews while doing claims work, but I know of very few adjusters who make a living off of doing the underwriting reviews. So I cannot say how many people this will put out of work.
If it meant not having to do a free square foot estimate on every cat claim, it would reduce the effort put into closing a claim. While I never complained about the paperwork involved in closing cats claims, (I always figured that was why we were compensated as we are) I have heard many an adjuster do exactly that.
So it is possible that some good may come of this particular software application. While technology will definitely transform our industry, I do not see being able to replace a trained, experienced set of eyes in the claims handling process for substantial claims. The role of the adjuster will change, but I do not believe it can disappear.
But in the words of Dennis Miller, "That's just my opinion, I could be wrong."
Jeff Goodman
www.stormcentral.com
One Man's Software
|
 |
|
|
CCarr
Canada
1200 Posts |
Posted - 05/22/2003 : 10:24:30
|
Yes Jeff, at this time, technology is not yet able to replace a trained experienced set of eyes in the claims handling process for substantial claims. But, we have seen technology eliminate or greatly reduce the need for those "field eyes" on less than substantial claims over the last 3 to 5 years.
Underwriting inspections used to be quite a "filler" for a number of adjusters between deployments, or had become a worthwhile alternative full time use of their skill sets. I see this InsureBASE(TM) technology as a grab at those former "field eyes" functions.
I agree InsureBASE(TM) has not inspected every address in the USA, in fact I doubt if any, past sufficient to test their templates. It is going to be a generic approach, the key to that is in their phrase; ".... accurate to a city block ....".
There is a wide and very distinct "divide" between what encompasses a RC for insurance purposes and what a MV is.
I doubt very much that this technology will eliminate the need for an adjuster to calculate or compute RC for claims purposes on a loss.
Every homeowner wants to recover depreciation, if and when applied, but there is an underlying concern by carriers that ITV overall is 20 to 25% below possible gains that should / could be achieved.
Yes, it will be good for carriers and agents to help capture more premium and commission dollars. However, the seemingly generic nature of the technology (and it is not what a municipality thinks an address is worth) casts a template over the process; and that is where the benefit of "human experience and skill" is lost. This technology will encompass a lot of data from already available sources. When they say, ".... provide .... property characteristics and an array of neighbourhood and other U/W information ....", they will template (among many other things) that the average age of a dwelling in a specific zip is "w", the mechanicals average age is "x", the roof type and average age is "y", and the loss history and type of loss in that zip is "z". All of this is U/W info useful in risk selection and pricing.
I created the thread, most likely because of what I saw it doing to the "loss control / inspection" person; which would only have a passing interest to an adjuster not directly involved part time or otherwise in that business sector. However, I do see it as another piece of erosion of "human services", that gets one step closer to more directly adversely affecting adjusters.
Is this a bad thing? From a "human services" standpoint, yes it is.
|
|
|
|
JimF
USA
1014 Posts |
Posted - 05/22/2003 : 11:26:32
|
This past week, I went in for my "annual check up" with my insurance agent, which lasted for almost 3 hours. Unlike most of his insureds, my agent (actually the agency principal) recognized that he was/is dealing with a (hopefully) informed purchaser of the insurance product and we both consider the other as a knowledgeable peer.
While completing an ITV analysis to update my coverages for my "mansion on the hill" the agent tinkered around for quite a while inputing data into his computer based on my responses to his set of questions which the computer prompted. In the end, he commented: "you know, I can make these numbers come out to be anything I want them to" to which I responded "yes, I know"; the reliance on a computer program to determine "values" is one of the underlying problems with both the agent side and the adjuster side of the claims equation.
(As a footnote, because I was 'informed' I was able to increase my coverages substantially, while lowering both my deductible and premium. One of the advantages in insurance shopping to adjusters in the know!)
How many adjusters, or insurers, or agents or consumers who were thinking seriously of selling their home would consider even for a moment, relying on some online or store bought software program to determine the market price for setting a sales price as opposed to seeking out either one of the more experienced Realtors or real estate appraisers? I know that I wouldn't and doubt that you or anyone else would either.
So if we wouldn't rely on a software program to set the price on our most valuable asset, our home for sale, is allowing that same software to determine our insurance coverage or indemnity settlement any less important or rational?
Due to other designations and certifications which I have held over the years, I have been privileged to both appraise real estate for market value purposes in condemnation cases, as well as testify as an expert witness in the courts in several states as to market values, for both real estate or insurance purposes (which by the way, an adjuster cannot legally do these days without appraisal certifications beyond the insurance certifications).
During my many courtroom appearances, I have watched in shock and awe at times when the newer, naive or incompetent appraiser tried to 'get past' the attorney for the other side during cross, by trying to explain an answer which relied too heavily on 'technology' or computer software rather than experience, education, personal examination and judgment. It wasn't a pretty sight to behold in that courtroom environment and it will not be a pretty sight to behold for those relying on this means for determining values in the courtrooms of the future. |
Edited by - JimF on 05/22/2003 11:39:35 |
|
|
|
JSVenning
USA
22 Posts |
Posted - 05/23/2003 : 23:38:30
|
Just a few thoughts:
1) Would you sell your home for what your tax jurisdiction appraises it for?
2) Could you build your home for that amount?
3) Does anyone with construction estimating/bidding/sub-contracting experience really believe any "historical" database, when it comes to bidding or selling a job?
For anyone who answers "yes" to any of these questions: Boy, do I have a deal for you on a great bridge in New York City. Just send $500 dollars earnest money for details. :) |
|
|
|
JimF
USA
1014 Posts |
Posted - 05/24/2003 : 07:52:40
|
| John, my sentiments exactly. |
|
|
|
Gale
USA
231 Posts |
Posted - 05/26/2003 : 00:30:40
|
Sometimes perhaps the dominant left-brain adjuster tends to dump logic into a situation that is not logical in a technical sense? Clayton wrote, “Yes, it will be good for carriers and agents to help capture more premium and commission dollars.” If this is the goal of the carrier and the use of this technology will factual do as it vendors claim, add more profits to the carriers then it will happen. I do wonder if the vendors of this technology actually will make up the cash difference if the technology was does not deliver as promised.
Having been in Vegas the last two weeks for back-to-back IA adjusting conventions I gather the big payouts are of no concern in that town if the bottom line objectives of the “house” are met. Apparently by all of the bright flashing lights they are paying the utilities. :)
|
|
|
| |
Topic |
|
|
|
Too many "technology nails" into the "job coffins"
Forum Locked
