HomeNews & IdeasNewsThe Domino Effect of Poor Risk Selection on Carrier Performance

The Domino Effect of Poor Risk Selection on Carrier Performance

Accurate risk selection is the heartbeat of profitability. According to Insurance Journal, for the second year in a row, the U.S. property & casualty industry booked an underwriting loss of more than $20 billion – primarily due to the lackluster performance of personal auto and home insurance lines. Outdated underwriting, limited insights, and a lack of policy monitoring are dragging many carriers into this costly spiral. Poor risk selection doesn’t just dent profits – it creates a chain reaction that impacts claims, customer loyalty, and market position.

This is a negative trend that carriers simply can’t afford. Breaking the cycle means rethinking risk management altogether. Continuous monitoring and real-time data need to replace outdated underwriting and “set it and forget it” policy management. The focus must shift to proactive, ongoing risk assessment that allows carriers to make a course correction before renewal.

In the end, it’s about seeing risk management as a dynamic process throughout the Policy Lifecycle that reduces risks and improves policyholder trust.

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