Mike and Ricky dive into the importance of segmentation and talk in detail about Ricky’s experience implementing segmentation into a client’s class plan.

Hi, everyone, Mike Altman here continuing our discussion on segmentation. Today I have Ricky Appel, a Product Manager here at MCA, to discuss the time that he implemented segmentation into a client class. First off Ricky, I want to talk through your idea of segmentation and why it’s so important.

Yeah, happy to. Segmentation is incredibly important for all of our clients. I think the biggest thing is identifying those areas where you want to best match price to risk and through doing so, avoiding adverse selection, is top of mind as other carriers have segmentation that maybe you don’t have that can make you highly susceptible to that. If that were to occur, there’s a number of profit challenges you may see down the road that segmentation will hopefully help alleviate.

Yeah, I think it’s perfect. As you think about the time that you implemented segmentation in the client’s class plan, want to talk through how you came up with the variables to introduce and then any issues that arose
when going through this implementation process.

So with the client, we identified essentially the top 3 to 4 variables that were causing the greatest profit challenges and through that essentially identified a go to market strategy to bring those to market. And when doing so uncovered a number of challenges, a lot in the IP side getting it to market, getting it through the insurance department. And there’s so many considerations there that we had to navigate. And so with that, we’re able to successfully navigate those, bring them to market and launch it for our client.

That’s awesome. And then, you implemented this segmentation into the client’s class plan, ran into some issues from a I.T. technical department of insurance standpoint. Fought through those and then, now these filings in market. How do you think about post-monitoring or the next change that’s coming. Additional segmentation and the class.

The biggest thing is making sure you have the data to actually post monitor. Once it goes live, we’re able to set that up. That was one of the technology challenges that we were up against, is making sure the data persisted into the data set we needed. And so through doing that, we were able to set up post-monitoring in a really easy, simplified way so that the client understood kind of what it looked like before, what it looked like after. And, you know, with that shared some of those learnings months after launch. And so once you brought that to market post-monitored, we then decided about eight months after to go in, revisit the decisions we made. Are they working or are they not working and made a couple of tweaks thereafter.

Yeah, I think that’s a really good story, right, as you think about this is an ongoing process. It’s a process of segmentation, the process of rate changes. It’s always ongoing. You’re always thinking about what comes next, how are you adjusting. Even the change that you just made and having that post monitoring data is so important.

It is cyclical. It’ll always happen and that’s really the discipline that we try and bring.
Awesome. Well, thanks for joining us. Really appreciate it and looking forward to talking to you more.

Awesome. Thanks.