Today Ron purchased a Signature Series auto policy for the first time. He qualifies for the Loyalty Discount. Calculate Ron’s loyalty discount using the following information:
- Ron has been continuously insured for 4 years
- Ron has been a AAA member for the past 5 years
Ron’s Loyalty Discount is 9%
100
What is our target penetration rate of auto insurance into membership? (We have achieved this in CA and NV)
Our target penetration rate is approximately 20%.
100
Name 3 states that were introduced to PAS and Signature Series at the same time?
CT, DE, ID, KS, KY, OR, MT, MD, NJ, NY, SD, PA, VA, WV and WY.
100
We are actively researching additional offerings for the youthful driver segment. What is the name of the discount/program we currently offer from vendor ADEPT Driver?
teenSMART or SMART discount
100
The Advanced Shopping Discount is a discount applied to new business policies if the quote was initiated by the customer more than seven days in advance of the policy effective date. Explain the intuition behind this discount.
This is a proxy for a responsible customer
200
Why aren’t the tier components of Signature Series auto discussed in detail?
a) Gives us a competitive advantage
b) It allows us to file tier confidentially instead of publicly
c) As an industry standard, insurance companies keep tier information private
d) All of the above
d) All of the above
200
As of the end of 2013, in terms of direct written premium, what is the IG's biggest state outside of California?
New Jersey ~$130M.
Followed by NV ~$100M and AZ ~$75M
The total Auto book = $2000M. CA = $1350M. ?
200
What does the acronym PAS stand for?
Policy Administration System
200
In 2010 we conducted a Usage Based Insurance (UBI) pilot named “uDrive” in Nevada. What year did Progressive first pilot its UBI product?
a) 1999
b) 2004
c) 2008
(a)1999
(Then called ‘Autograph’; in 2004 renamed Tripsense; in 2008 renamed MyRate; and in 2011 renamed Snapshot).
200
Previously we used ISO physical damage symbols. In Signature Series, we are using proprietary symbols. Why?
- Consistency between products (CA Select and Signature Series)
- Less reliance on a vendor, so quicker updating
- Utilizing our own data for analysis
300
John has been a AAA Signature Series customer for the last 6 years. In that time he has never been in an accident. Today he rear ended the car in front of him causing $3,000 in damage. How will this at-fault accident affect his rate at his next renewal?
Since John has been insured with AAA for over 4 years with no activities, he will be protected by the Accident Surcharge Waiver. His rate will not be impacted by this at-fault accident.
300
Name three (3) states that met individual auto new business growth target in 2013?
12 states
AZ, CA, CO, CT, ID, KS, KY, NY, OK, OR, SD, UT
300
To quote and bind a Signature Series auto policy on PAS, five (5) total reports are ordered. Name three (3) of them?
Membership, Insurance score, Current Carrier are required at quote; CLUE and MVR are required to bind.
300
Monitoring new enhancements introduced by competitors is important to proactive insurance companies. A key document that must be submitted for approval to each states Department of Insurance provides detailed information on these enhancements. What is this document called?
Rate/Rule Filing
300
According to the Product Strategy there are six characteristics that are representative of our Target Segment (tiers J-H). Name at least three (3) of these characteristics?
- Tenured members
- BI Limits of 100/300
- multi-policy
- multi-car
- 45-60 age range
- Pay-in-Full/EFT
400
NY and CA use “driver assignment” to assign a driver to each vehicle. Explain how our base Signature Series product works with respect to driver/vehicle rating.
Signature Series uses what we call “driver averaging.” This method spreads the risk across all vehicles.
400
What is our targeted non-CAT loss ratio for auto, assuming a 39% expense ratio?
a) 42%-54%
b) 54%-66%
c) 67%-75%
(B) 54%-66%.
400
What is the average quote time (in minutes) on PAS?
a) 4 minutes
b) 7 minutes
c) 9 minutes
7 minutes
400
In order to learn more about the benefits of cognitive training, we are currently working with a company called Posit Science on an offering for senior drivers. How might cognitive training improve the driving of seniors?
Studies suggest improved:
- Reaction times
- Awareness
- Field of view
- Confidence
400
For a 12-months policy, what is/are the payment plan(s) that qualify for a Payment Plan Discount?
a) Annual only
b) Annual and Semi-Annual only
c) Quarterly and Monthly only
d) All, except Monthly
d) All, except Monthly
500
Premiums may change without an endorsement. Name four possible reasons?
- Loyalty
- Membership and Auto Insurance
- Persistency
- New accidents or violations
- Accident/violations aging and dropping off
- Advanced Shopping Discount dropping off
- New car discount dropping off
- Youthful discounts aging and dropping off
- Age of drivers
- Annual Rating Factor
- Tier causes HH comp to change
- Tier causes Driver Class to change
500
In 2012, the second most common driver level discount in Signature Series was the Defensive Driver Discount (4.2%). Which of the following was the most common driver level discount?
a) AAA Membership Discount
b) Smart Driver Discount (teenSMART)
c) Good Student Discount
As of June 5, 2013, how many Signature Series auto policies have been quoted/sold on PAS?
a) 8621 ; 2155
b) 13213 ; 4624
c) 5357 ; 968
d) 18916 ; 2058
d) 18916 ; 2058
AZ – quoted 2337, sold 316
OK – quoted 1952, sold 413
IN – quoted 3766, sold 357
OH – quoted 4612, sold 470
MT– quoted 979, sold 117
VA - quoted 5270, sold 385
500
Identify the incorrect statement regarding our UBI program?
(1) It offers a policy level discount at renewal based on the customers driving score
(2) Currently, a 10% discount is applied at new business
(3) The device must be plugged into the vehicle within 30 days of bind in order for the discount to be applied
(4) UBI is available in limited states and will rollout to more states in 2014
(1) It offers a policy level discount at renewal based on the customers driving score
500
With SS, we can expect average premium to drop. Why?
- More preferred product attracts less risky customers who are less expensive to insure
- More discounts for AAA members
- Price fluctuations during conversions. Customers receiving increases are more likely to leave and customers receiving decreases are more likely to stay.