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Insurance Price Optimization: Lawyer's Perspective

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by William Gausewitz
Carrier Management
May 20, 2015

William Gausewitz's article "Insurance Price Optimization: Lawyer's Perspective," was published in Carrier Management on May 20, 2015.

From the article...

" A major controversy is growing in the world of insurance regulation over price optimization. Regulators are becoming increasingly aggressive on the issue. Maryland, California, Ohio and New York have all taken steps to restrict the practice. The National Association of Insurance Commissioners is actively studying whether the practice needs to be curbed. The issue is heating up rapidly.

What is price optimization?

There is no clear definition. Maryland defined it as “the practice of varying rates based upon factors other than the risk of loss.” California defined it as “any method of taking into account an individual’s or class’s willingness to pay a higher premium relative to other individuals or classes.” (Editor’s Note: Just last week, Florida banned the practice of price optimization. See related article, “Florida Bans Price Optimization; Insurers Question Definition.”)"

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