Blog: Model behaviour for insurance risk prediction - destroying the myth of the magic funnel

The Financial Conduct Authority announced in September that it is planning to launch a market study into how general insurance firms price home and motor insurance, following a super complaint by the Citizen Advice Bureau to the Competition and Markets Authority.

With the UK insurance sector coming under further regulatory pressure, the time would seem ripe to re-evaluate the use of data to inform pricing strategies and perhaps take a back to basics approach to help ensure the right foundations are in place for risk modelling.

In this blog post, Alan O’Loughlin, head of analytics and statistical modelling at Lexis Nexis Risk Solutions, highlights how insurers can gain a strategic advantage over their competitors by maximising their data models to create more intelligible insights.