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Valen Study Shows Analytics Help Insurers Outperform Market Averages

Staff Writer | May 04, 2017

Valen Analytics, an Insurity company, announces their annual five-year ROI study. From 2012-2016, Valen customers collectively saw an average of 25 percent loss ratio improvement, nearly double the industry average of 13 percent. Results were calculated across 16 workers’ compensation customers, totaling $1.76 Billion in premium. During this time period, insurers using Valen’s analytics solutions also experienced 53 percent growth in direct written premium, compared to 19 percent for the rest of the industry.

This is the second consecutive year Valen has studied its client base on a trailing five-year period. The previous year’s study analyzed the results of 12 workers’ compensation carriers from 2011-2015 totaling $1.5 billion in premium, showing similar and consistent results across both metrics. Valen clients saw an average of 30.8 percent loss ratio improvement against the industry average of 15 percent and experienced 82 percent direct written premium growth compared to 26 percent.

“The consistent annual results of this study highlight how Valen is working with insurers to set a standard for best practices around analytics implementation,” says Dax Craig, CEO of Valen Analytics. “Each insurer understands that the predictive model is only one part of the equation, and that to succeed, companies need a data-first approach. This requires that business strategy and measurable outcomes are clearly defined in order to point the analytics toward what they want to achieve.”

Insurance carriers included in the study have been engaged with Valen Analytics for two to five-plus years.

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