QPC uses geoprocessing to analyze auto insurance risk factors
SFGate features a article on how Quality Planning Corporation (“QPC”) used a solution developed by Farallon Geographics using Oracle Spatial 10g to geoprocess location information from 15 million auto insurance policies and 2 million claims and develop predictive location-related risk levels for insurers.
In the insurance and rish management industry, there are many factors which impact the level of risk posed to each insurer. Farallon Geographics’ risk management client Quality Planning Corporation (“QPC”) wanted to be able to identify and correlate a broad range of historical information in order to improve the way insurance companies currently rate policies.
The core requirements were intensive large volume geoprocessing resulting in tabular input to statistical analysis software to determine the predictability of potential risk factors.
A report in December 2005, based on this solution analyzed 15 million auto insurance policies and 2 million claims to map out traffic accidents severe enough to cause property damage. Example findings included: Drivers living within a mile of a church are the safest—they’re 10 percent less likely to crash than their fellow drivers; rivers residing within a mile of a restaurant are 30 percent more likely to be in an accident; and motorists living near elementary schools wind up in more accidents than those living near a liquor store,
QPC predicts insurers will draw upon the reports findings to recalculate their prices, producing in rate decreases for some drivers and boosting the premiums of motorists living in high-risk neighborhoods.
