INSURANCE PRICING ROOM

OUR UNIQUE VALUE PROPOSITION

Data XL allows companies to set-up the best price.  

Price will be no longer based on cost, but on customers' perceived value or on market rules. 


This premium price either reduces customer churn, optimizes customer price preferences (~market share), maximizes the margin and much more. 


We use behaviour data and experimental design to predict value, not to reduce cost.

KEY BENEFITS

  • You can have the first results in 10 weeks time (in a poc)
  • No need of a full crawler of every risk factor combination in the market, we use experimental design techniques to capture the price engines in the market – this feature is quite relevant for the agent and broker channel
  • We do not use only internal data. We look for external information (from brokers from the market) and conduct experiments. That gathering should not be restrain by questions convenience 
  • Identify the features that customers value the most and more importantly how much are they willing to pay for them
  • We use experimental design, and external data, we should be more precise
  • No setup cost
  • Fast results
  • No IT layer
  • We do not sell a software and a manual
  • The strategy will always remain in the insurer or broker
  • We (can) work with a success fee

MAGIC METRIC

  1. MARKET PRICING: Reverse engineer competitor pricing with R2>95% accuracy.


  2. VALUE BASED PRICING: Increase renewal pricing by ~4% (on average) without any market share loss.

WHY IS DATA XL DIFFERENT

With experimental design we can capture the competitor price

Data XL has developed an algorithm that, with experimental design, can capture competitor pricing, enabling Data XL clients to offer MARKET PRICE and support the willingness to pay measurement and the setup of the VALUE BASED PRICE. 


Note that:

  • Data XL do not need thousands of quotations to capture the price models.
  • Data XL obtains data / local information and combines this with API access for a full solution.
  • The market information provided is not easily obtainable therefore not available to brokers/ Data XL competitors.

Predict the Willigness to Pay with experimental design

Data XL uses a GLM model to predict the willingness to pay (VALUE BASED PRICING) with a "secret sauces". 

Customer willingness to pay is measured using the same risk factors that all insurers use and the market price [a plus]. 


Data XL's "secret sauces" is the sample data.


Big data or observational data cannot measure with accuracy the true willingness to pay. Experimental design gives causality (true willingness to pay). This experiment information is first collected via surveys, therefter with backtesting and live experiments.
 

We use all the information available. Not just the convenience/internal data

Data XL uses all the information mentioned to optimize the price (margin, share or retention). 


Data XL unique approach bears in mind competitor pricing as well as the customer’s individual characteristics (the same basis of the risk approach). It is therefore more comprehensive than it's competitors and more precise. 

SOLUTION DESCRIPTION

Data XL platform has the following modules:

  • Cost base pricing /actuarial pricing: measure the prospective cost of a claim and help insurance companies to redefine their cost structure. Data XL still prefers that the client provides this information as an input, using their one knowledge and expertise.

  • Market Pricing: an algorithm that, with experimental design, can accurately capture competitor pricing.

  • Value Based Pricing: a GLM model (with a some proprietary elements) to predict the customer's willingness to pay.

  • Optimal Pricing: using mathematical techniques to design the best price: a price that reduces churn, allows a better margin and that maximizes the share of preferences.

Our mathematical algorithm is more comprehensive than others on the market. In fact we are the only ones that combine risk cost, competitors' view and willingness to pay.


Futhermore, while our competitors opt to sell a software platform not a solution, they do not isolate the price from other marketing mix elements. Therefore, their solution is based only on (lowering) the price.



CHECK OUT our Platform presentation video

Check out this great video that we used on F10 DEMO DAY in Zurich

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