Agenda

The New NCCI Hazard Groups

Greg Engl, PhD, FCAS, MAAA

National Council on Compensation Insurance

CASE Fall MeetingSeptember 13, 2006

© Copyright 2006 National Council on Compensation Insurance, Inc. All rights reserved. 2

Agenda

•History of previous work

•Methodology employed

• Impact of remapping


Current Hazard Groups

HG Number of

ClassesStandard Premium

% of Total Premium

I 40 1,262,958,374 0.9%

II 417 67,150,463,296 45.5%

III 303 75,288,994,325 51.1%

IV 100 3,623,213,832 2.5%


Assigning Classes to HGs

•Prior NCCI Method

•California Approach

•ELF Based Method


Prior NCCI Method

•Hazardousness

• “Excess loss potential”


For each state, the following seven quantities were measured by class and expressed as ratios to the corresponding statewide value:

Claim FrequencyIndemnity Pure PremiumIndemnity SeverityMedical Pure PremiumMedical SeverityTotal Pure PremiumSerious Severity (including Medical)

Hazardousness Variables


California Methodology

•Group classes with similar loss distributions together

•Need to precisely define ‘similar’


Crossover

Excess Loss Factors

LossLimit O P

25,000 0.643 0.660600,000 0.098 0.082

Hazard Group


CrossoverCalifornia ELF Curves

0.00

0.02

0.04

0.06

0.08

0.10

0.12

Per Accident Limit ($M)

Lo

ss E

lim

inati

on

Rati

o

J

K

L

M

N

O

P

Q

R

1 2 3 5 104 6 7 8 9


CrossoverCalifornia ELF Curves

0.060

0.065

0.070

0.075

0.080

0.085

0.090

0.095

0.100

$1,200,000 $1,400,000 $1,600,000 $1,800,000 $2,000,000 $2,200,000

Per Accident Limit

Lo

ss E

lim

inati

on

Rati

o

J

M

R


HG Remapping Rationale

•What are HGs used for?

•Determining ELFs


Excess Loss Pure Premium Factors (Applicable to New and Renewal Policies)

Per Accident Hazard GroupsLimitation I II III IV

$25,000 0.701 0.727 0.813 0.865$30,000 0.675 0.703 0.794 0.850*$35,000 0.651 0.682 0.777 0.837$40,000 0.630 0.662 0.761 0.824*$50,000 0.593 0.628 0.732 0.802*$75,000 0.521 0.561 0.674 0.754

$100,000 0.466 0.509 0.628 0.714*$125,000 0.422 0.466 0.589 0.680$150,000 0.386 0.430 0.555 0.650$175,000 0.355 0.399 0.525 0.623$200,000 0.328 0.373 0.498 0.598$250,000 0.285 0.329 0.452 0.555$300,000 0.251 0.294 0.413 0.517$500,000 0.167 0.205 0.308 0.406

$1,000,000 0.088 0.117 0.188 0.262$2,000,000 0.045 0.064 0.108 0.155$5,000,000 0.020 0.032 0.053 0.075

* Also applicable to Underground Coal Mine classifications.

Kentucky 9/1/04 Filing


Kentucky ELPPFs

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

0 1 2 3 4 5

Loss Limit (millions)

ELP

PF

HG I HG I IHG I I I HG IV


Kentucky ELPPFs

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

0 1 2 3 4 5


ELP

PF



Kentucky ELPPFs

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

0 200 400 600 800 1000

Loss Limit (thousands)

ELP

PF



Kentucky ELPPFs

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

0 1 2 3 4 5


ELP

PF



Kentucky ELPPFs

0.00

0.02

0.04

0.06

0.08

0.10

0.12

0.14

0.16

0.18

0.20

1000 2000 3000 4000 5000

Loss Limit (thousands)

ELP

PF



HG Remapping Approach

• Makes sense to sort classes by ELF vectors

• Class ELF vectors approximated by HG ELF vectors

• ELF curves characterize loss distribution


Excess Ratio Calculations

)()( iii ARwAR

iRi etypinjury for function ratio excess

iii LLw

losses typeinjury iLi

loss typeinjury mean ii


HG RemappingBasic Data

• For each class code, , we have a vector of ELFs:

• Credibility weight with current HG ELF vector

c

),,,( 53025cM

cK

cKc xxxx



0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700

Excess Ratio at $100K

Ex

ce

ss

Ra

tio

at

$1

M



0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700


Ex

ce

ss

Ra

tio

at

$1

M


New 4 Hazard Groups

0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700


Ex

ce

ss

Ra

tio

at

$1

M


0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700


Ex

ce

ss

Ra

tio

at

$1

MNew 4 Hazard Groups


4 Hazard Group ComparisonNumber of Classes per Hazard Group

Current Mapping

40

417303

100

New Mapping

212

260

265

123

HG 1

HG 2

HG 3

HG 4


4 Hazard Group Comparison Percent of Premium Per Hazard Group

Current Mapping

45.5%51.1%

2.5% 0.9%

New Mapping

17.9%

37.8%

39.2%

5.1%

HG 1

HG 2

HG 3

HG 4


Hierarchical Collapsing of New Mapping

A B C D E F G

1 2 3 4


New Hazard GroupsNumber of Classes per HG

176

193198

67

123 36

67

Percent of Premium per HG

13.6%

25.5%19.9%

19.3%

5.1%

12.3%

4.3%

HG A

HG B

HG C

HG D

HG E

HG F

HG G


New Hazard Groups

0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700


Ex

ce

ss

Ra

tio

at

$1

M


New Hazard Groups

0.000

0.050

0.100

0.150

0.200

0.250

0.200 0.300 0.400 0.500 0.600 0.700


Excess R

ati

o a

t $1M


Percent of Premium MovedCurrent Mapping to New 4 Hazard Groups

* Number above bar represents the number of classes in each category.

0%

10%

20%

30%

40%

50%

60%

70%

80%

NoMovement

Up 1 HG Down 1 HG Up 2 HGs Down 2HGs

Movement

Per

cen

t o

f P

rem

ium

586

51

219

3 1


Movement of ClassesCurrent Mapping

Hazard Group I II III IV Total

Number of Classes 40 417 303 100 860Percent of Premium 0.9% 45.5% 51.1% 2.5% 100%

Hazard Group36 175 1 0 212

0.8% 16.9% 0.1% 0.0% 17.9%

2 220 38 0 2600.0% 26.9% 10.8% 0.0% 37.8%

2 21 236 6 2650.0% 1.7% 37.3% 0.3% 39.2%

0 1 28 94 1230.0% 0.0% 2.9% 2.2% 5.1%

2

3

4

Ne

w M

ap

pin

g

1


Number of Hazard GroupsCalinski and Harabasz

2000

2400

2800

3200

3600

4 5 6 7 8 9

Number of Hazard Groups

CH

Sta

tis

tic

Number of HGs 4CH Statistic 2317

53310

63213

73442

83297

93102


Number of Hazard GroupsCubic Clustering Criterion

85

95

105

115

125

4 5 6 7 8 9


CC

C S

tati

sti

c

Number of HGs 4CCC Statistic 89

5110

6108

7112

8111

9125



Calinski and Harabasz

Number of HGs All Classes 50% Credibility Classes Full Credibility Classes4 2317 793 4335 3310 759 3936 3213 705 4507 3442 1025 6388 3297 958 6209 3102 915 584

Cubic Clustering Criterion

Number of HGs All Classes 50% Credibility Classes Full Credibility Classes4 89 51 375 110 50 346 108 48 367 112 59 428 111 57 419 125 56 40


Three Key Ideas

•Map based on ELFs

•Compute ELFs by class

•Cluster Analysis


HG RemappingObjective

Break C = set of all class codes, into Hazard Groups:

i

iHGC


HG RemappingBasic Data

For each class code, , we have a vector of ELFs:

c

),,,( 53025cM

cK

cKc xxxx


Using Hazard Groups

• (HG mean)

• approx by for

• Want as close as possible to

iHGcc

ii xHG

x1

cx ix iHGc

cx ix


HG Remapping Methodk-means

Splits classes into HGs to minimize

k

i HGcixcx

i1

2


Optimal HGs

• % of total variance explained

• Analogous to an R-squared

• k-means maximizes this


R-squared

cc

k

i HGcic

xx

xx

R i

2

1

2

2 1


Optimal HGs

• Want well separated, homogeneous HGs

• Minimize within variance

• Maximize between variance


Optimal HGs

• Between variance vs. within variance

• Have one variance for each variable (ELFs at different attachment points)

• Need to consider variance-covariance matrices


Optimal HGs

Dispersion matrix of whole data set is given by

xxxxT c

T

cc


Dispersion Matrix

5554535251

4544434241

3534333231

2524232221

1514131211

ˆˆˆˆˆ

ˆˆˆˆˆ

ˆˆˆˆˆ

ˆˆˆˆˆ

ˆˆˆˆˆ

)1(

nT


Optimal HGs

Dispersion matrix of HGi is given by

ic

T

HGcici xxxxW

i


Optimal HGs

• If we let

• Then

xxxxHGB i

T

iii

iicT

HGcc WBxxxx

i


Optimal HGs

• Pooled within group dispersion matrix

• Weighted between group dispersion matrix

k

iiWW

1

k

iiBB

1


Optimal HGs

• Between variance vs. within variance

• T = B + W

• k-means minimizes trace W


Credibility

•Compute class ELFs

•Assign a credibility to each class

•Use current HG as complement


History

• Hazard Groups were last remapped in 1993

• Prior to that, Hazard Groups were remapped in 1981

• Same credibility method used both times


Pseudo-Bühlmann

where

n = number of claims

1,5.1min

kn

nz

nk


Pseudo-Bühlmann

• A class with the average number of claims gets 75% credibility.

• Classes with twice the average number of claims get full credibility.

• Based on n/n+k


Pseudo-Bühlmann Credibility

0%

20%

40%

60%

80%

100%

0 87 174 261 348 435 522 609 696 783 870

Number of Class Codes (Ordered by Size)

% C

red

ibili

ty


Pseudo-Bühlmann Credibility

Credibility Size Range

Claims per Year

Number of Classes

% Premium

0% Z < 10% 0-237 355 1.2%

10% Z < 20% 238-511 89 1.3%

20% Z < 30% 512-831 61 1.6%

30% Z < 40% 832-1209 56 2.7%

40% Z < 50% 1210-1662 46 2.5%

50% Z < 60% 1663-2216 34 2.5%

60% Z < 70% 2217-2909 46 4.8%

70% Z < 80% 2910-3800 35 4.3%

80% Z < 90% 3801-4987 29 4.0%

90% Z < 100% 4988-6650 18 3.2%

Z = 100% 6651 101 71.8%


Number of Classes by Claim Count

833

5020 14 3 5 6 1 0 2 0 0 0 1 0 0 1 0 0 0 1

0

100

200

300

400

500

600

700

800

0 20 40 60 80 100

120

140

160

180

200

220

240

260

280

300

320

340

360

380

400

420

Number of Claims (thousands)

Nu

mb

er

of

Cla

ss

es

in In

terv

al



0

50

100

150

200

250

300

350

400

450

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Number of Claims (thousands)

Nu

mb

er

of

Cla

ss

es

in In

terv

al



0

50

100

150

200

0 50 100

150

200

250

300

350

400

450

500

550

600

650

700

750

800

850

900

950

1000

Number of Claims

Nu

mb

er

of

Cla

ss

es

in In

terv

al


Revenue Neutrality

• Overall average ELF’s unaffected, therefore no overall premium effect.

• Individual risks may experience increases or decreases.

• Individual risk equity improved. • For deductibles of $5,000 or less, the

impact of the revised credit on the loss cost premium of most risks will be less than 5%.


Impact of New HGs on ELFs

•ELFs computed by HG

•New HGs alone change ELFs

•Extra year of trend

•Change in ELF Calculations


ELF Calculation Changes

• Average with last year’s ELFs

–Loss limits adjusted for inflation

–Provides additional stability

• Additive differential trend adjustmentRecognizes that med loss trend higher than indemnity


Additive Adjustment to ELFs*all states, all HGs

Loss limit Adjustment

0-$125,000 .000

$150,000-$225,000 .001

$250,000-$700,000 .002

$800,000-$1,000,000 .003

$2,000,000-$5,000,000 .002

$6,000,000-$10,000,000 .001

Over $10,000,000 .000

*Included in B-1403.


Movement of ClassesCurrent Mapping




0.8% 16.9% 0.1% 0.0% 17.9%

2 220 38 0 2600.0% 26.9% 10.8% 0.0% 37.8%

2 21 236 6 2650.0% 1.7% 37.3% 0.3% 39.2%

0 1 28 94 1230.0% 0.0% 2.9% 2.2% 5.1%

2

3

4

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1


Movement of Classes

• General movement of classes to lower HGs

• Classes with high ELFs moving to lower HGs

• General increase in HGs ELFs


Impact of Remapping on ELFsCountrywide Excess Ratios

0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0.160

0.180

0.200

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650

Excess Ratio at $100 K

Ex

ce

ss

Ra

tio

at

$ 1

mill

ion

HG I

HG II

HG III

HG IV

HG 1

HG 2

HG 3

HG 4



0.00

0.01

0.02

0.03

0.04

0.05

0.06

0.07

0.08

0.09

0.000 0.050 0.100 0.150 0.200 0.250 0.300


Ex

ce

ss

Ra

tio

at

$ 3

mill

ion

HG I

HG II

HG III

HG IV

HG 1

HG 2

HG 3

HG 4


Old and New Hazard GroupsCountrywide Excess Ratios

0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0.160

0.180

0.200

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650


Ex

ce

ss

Ra

tio

at

$ 1

mill

ion HG I

HG II

HG III

HG IV

HG A

HG B

HG C

HG D

HG E

HG F

HG G


New Hazard GroupsCountrywide Excess Ratios

0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0.160

0.180

0.200

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650


Ex

ce

ss

Ra

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at

$ 1

mill

ion HG 1

HG 2

HG 3

HG 4

HG A

HG B

HG C

HG D

HG E

HG F

HG G



0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0.160

0.180

0.200

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650


Ex

ce

ss

Ra

tio

at

$ 1

mill

ion

HG I

HG II

HG III

HG IV

HG 1

HG 2

HG 3

HG 4


Impact of Remapping in ALAlabama Excess Ratios

0.000

0.050

0.100

0.150

0.200

0.250

0.300

0.350

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650 0.700 0.750


Ex

ce

ss

Ra

tio

at

$ 1

mill

ion

HG I

HG II

HG III

HG IV

HG 1

HG 2

HG 3

HG 4


Impact of Remapping in ILIllinois Excess Ratios

0.000

0.050

0.100

0.150

0.200

0.250

0.300

0.350

0.250 0.300 0.350 0.400 0.450 0.500 0.550 0.600 0.650 0.700 0.750


Exc

ess

Rat

io a

t $

1 m

illio

n

HG I

HG II

HG III

HG IV

HG 1

HG 2

HG 3

HG 4


Change in Excess RatiosHG I to HG 1Change Due to New Mapping

AverageMinimum Maximum Difference*

$100,000 (0.009) AK 0.013 CT 0.004$200,000 (0.004) AK 0.014 CT 0.006$300,000 (0.002) AK 0.013 CT 0.006$500,000 0.000 AK 0.013 NV 0.006

$1,000,000 0.001 NM 0.012 NV 0.004$5,000,000 0.000 HI 0.007 NV 0.002

Percentage Change Due to New Mapping


$100,000 -2.5% AK 5.6% MO 1.2%$200,000 -1.9% AK 9.9% MO 3.1%$300,000 -1.2% AK 12.7% MO 4.4%$500,000 0.2% AK 16.7% MO 6.3%

$1,000,000 1.9% NM 20.2% MO 9.1%$5,000,000 3.7% VA 26.9% CT 14.0%

*Loss-weighted average over 29 states


Change in Excess RatiosHG I to HG 1

Change Due to New Mapping

(0.010)

(0.005)

0.000

0.005

0.010

0.015

0.020

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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-6%

0%

6%

12%

18%

24%

30%

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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Change in Excess RatiosHG II to HG 2Change Due to New Mapping


$100,000 0.016 AK 0.031 CT 0.025$200,000 0.013 AK 0.028 CT 0.020$300,000 0.010 IN 0.024 CT 0.017$500,000 0.006 AK 0.019 MD 0.012

$1,000,000 0.002 AK 0.012 AL 0.007$5,000,000 (0.001) AK 0.005 NV 0.002



$100,000 3.9% MT 12.2% KS 7.0%$200,000 4.8% MT 14.7% KS 8.8%$300,000 5.2% MT 14.9% KS 9.8%$500,000 5.3% AK 17.1% IL 10.7%

$1,000,000 3.0% AK 19.1% CT 10.9%$5,000,000 -3.2% AK 22.1% RI 9.4%



Change in Excess RatiosHG II to HG 2


(0.005)

0.000

0.005

0.010

0.015

0.020

0.025

0.030

0.035

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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-6%

0%

6%

12%

18%

24%

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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Change in Excess RatiosHG III to HG 3Change Due to New Mapping


$100,000 (0.000) AK 0.013 RI 0.005$200,000 (0.001) AK 0.011 RI 0.005$300,000 (0.002) AK 0.009 RI 0.004$500,000 (0.003) AK 0.008 ME 0.003

$1,000,000 (0.004) AK 0.005 ME 0.002$5,000,000 (0.002) AK 0.002 RI 0.001



$100,000 -0.1% AK 3.6% RI 1.1%$200,000 -0.4% AK 4.5% RI 1.4%$300,000 -0.8% AK 4.9% RI 1.6%$500,000 -1.7% AK 5.4% RI 1.8%

$1,000,000 -3.8% AK 5.8% RI 1.9%$5,000,000 -8.3% AK 7.8% RI 1.6%



Change in Excess RatiosHG III to HG 3


(0.006)

(0.004)

(0.002)

0.000

0.002

0.004

0.006

0.008

0.010

0.012

0.014

0.016

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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Change in Excess RatiosHG IV to HG 4Change Due to New Mapping


$100,000 (0.011) AK 0.025 CO 0.005$200,000 (0.013) AK 0.033 CO 0.008$300,000 (0.013) RI 0.039 CO 0.011$500,000 (0.012) RI 0.043 CO 0.014

$1,000,000 (0.010) RI 0.049 NV 0.016$5,000,000 (0.005) RI 0.040 NV 0.012



$100,000 -2.2% RI 4.6% CO 0.9%$200,000 -3.6% RI 8.2% CO 1.9%$300,000 -4.4% RI 11.8% CO 3.0%$500,000 -5.4% RI 17.8% CO 5.3%

$1,000,000 -6.7% RI 28.2% CO 10.2%$5,000,000 -9.9% RI 43.2% CO 26.3%



Change in Excess RatiosHG IV to HG 4


(0.020)

(0.010)

0.000

0.010

0.020

0.030

0.040

0.050

0.060

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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-20%

-10%

0%

10%

20%

30%

40%

50%

$100,000 $200,000 $300,000 $500,000 $1,000,000 $5,000,000

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Change in HG Excess Ratios

•Biggest increases at higher limits in HG I and IV

•Considerable variation by state

•Total change due to remapping, trend, and calculation changes


Excess Ratio Calculations

)()( iii ARwAR

iRi etypinjury for function ratio excess

iii LLw

losses typeinjury iLi

loss typeinjury mean ii


% Change in Average Cost per Case

Injury Type

Hazard Group

1 2 3 4

Fatal +48.6% +14.0% +2.2% -5.3%

PT +18.7% +4.0% +3.4% +29.2%

PP +2.1% +9.1% +2.8% -6.0%

TT -3.3% +4.8% +1.1% -5.8%

Med Only -6.8% +2.9% +1.4% -9.5%


PT Average Cost per CaseHazard Group 4

HG IV

$413,376

HG 4

$533,913

$ 214,619 $ 573,275$ 450,789


% Change in Injury Type Weights

Injury Type

Hazard Group

1 2 3 4

Fatal +133.3% +30.0% +3.8% -23.4%

PT +12.1% +8.2% 0.0% +39.4%

PP -1.6% +2.7% +0.7% -1.5%

TT -4.7% -3.3% -1.3% -2.3%

Med Only +15.2% -13.2% -5.2% -29.2%


PT WeightHazard Group 4

HG IV

10.4%

HG 4

14.5%

4.1% 15.7%12.0%


Impact of Remapping

vs.

Trend, and ELF Calculation Changes



$250,000

-5%

0%

5%

10%

15%

20%

25%

30%

NM SC MT OR VA ME LA AR HI MD AK NH NC OK NV MS SD VT IN TN RI NE CT CO IL KS MO

State

Per

cen

tag

e C

han

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in E

xces

s R

atio

s

Total Change in B-1403 Change Due To Remapping



$250,000

0%

5%

10%

15%

20%

25%

30%

MT SC OR AR NV NM ME VA MD NC SD AK NH VT OK LA HI TN MS NE CO RI CT IN IL KS MO

State

Perc

en

tag

e C

han

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n E

xcess R

ati

os




$250,000

-2%

0%

2%

4%

6%

8%

10%

12%

SC MT OR OK NM AR SD NV MD ME LA HI NH AK VA NE CO VT NC MS CT IN IL TN RI MO KS

State

Perc

en

tag

e C

han

ge i

n E

xcess R

ati

os




$250,000

-10%

-5%

0%

5%

10%

15%

20%

RI SD OK AK HI NH LA ME MD NE VA VT NM SC CT MT OR NC MS IL MO KS NV AR TN IN CO

State

Perc

en

tag

e C

han

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n E

xcess R

ati

os




$1,000,000

0%

10%

20%

30%

40%

50%

60%

70%

80%

AR NM VA SC MT HI ME MS OR SD NV MD NC TN LA NH RI IN VT AK KS CO NE OK IL CT MO

State

Per

cen

tag

e C

han

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in E

xces

s R

atio

s




$1,000,000

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

MT AR OR SC NV NM SD VA HI TN MS AK NC ME NE VT LA CO RI MD OK NH IN KS CT IL MO

State

Perc

en

tag

e C

han

ge i

n E

xcess R

ati

os




$1,000,000

-5%

0%

5%

10%

15%

20%

MT AR OR SC SD NM NV OK AK NE HI LA VA CO ME TN MD MS NH VT IN RI NC KS MO CT IL

State

Perc

en

tag

e C

han

ge i

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xcess R

ati

os




$1,000,000

-10%

0%

10%

20%

30%

40%

50%

RI SD NH ME AK HI OK VA MD NE LA CT SC NM VT MT NC MS OR IL MO NV AR KS TN IN CO

State

Perc

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xcess R

ati

os



Key TransitionsCurrent Mapping




0.4% 3.9% 0.0% 0.0% 4.3%

10 165 1 0 1760.4% 13.0% 0.1% 0.0% 13.6%

1 178 14 0 1930.0% 21.7% 3.7% 0.0% 25.5%

1 42 24 0 670.0% 5.2% 7.1% 0.0% 12.3%

2 17 178 1 1980.0% 1.5% 18.4% 0.0% 19.9%

0 4 58 5 670.0% 0.2% 18.9% 0.3% 19.3%

0 1 28 94 1230.0% 0.0% 2.9% 2.2% 5.1%

Ne

w M

ap

pin

g

F

G

A

B

C

D

E


Largest Class Codes Transitioning From II to B

Class Code

DescriptionPremium Size (8810

= 1000)

8017 Store: Retail NOC 451*

8018 Store: Wholesale NOC 271

8868College: Professional Employees and Clerical

223

9052Hotel: All Other Employees and Salespersons, Drivers

219

9101College or School: All Other Employees

162

*Indicates premium 45.1% of 8810 premium.


Largest Class Codes Transitioning From II to C

Class Code

DescriptionPremium Size (8810 =

1000)

8810 Clerical Office Employees NOC 1000

8829Convalescent or Nursing Home—All Employees

293

8033Store: Meat, Grocery and Provision (Combined)—Retail—NOC

248

8833 Hospital: Professional Employees 214

9014Buildings—Operation by Contractors

189


Change in HG II Excess RatiosChange Due to New Mapping

Hazard Group II - BAverage

Minimum Maximum Difference*$100,000 (0.039) MT (0.010) HI (0.021)$200,000 (0.041) MT (0.008) HI (0.020)$300,000 (0.040) MT (0.006) HI (0.018)$500,000 (0.035) MT (0.004) HI (0.015)

$1,000,000 (0.027) MT (0.002) HI (0.010)$5,000,000 (0.013) NV (0.001) HI (0.004)

Hazard Group II - CAverage

Minimum Maximum Difference*$100,000 0.007 OR 0.021 CT 0.014$200,000 0.005 AK 0.018 CT 0.011$300,000 0.003 AK 0.015 CT 0.009$500,000 0.001 AK 0.012 CT 0.007

$1,000,000 (0.001) AK 0.008 NV 0.004$5,000,000 (0.001) AK 0.003 NV 0.001




-0.050

-0.040

-0.030

-0.020

-0.010

0.000

0.010

0.020

0.030

0.040

HG B HG C$100K

HG 2 HG B HG C$500K

HG 2 HG B HG C$1M

HG 2 HG B HG C$5M

HG 2

Ch

an

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in

Ex

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ati

o


Change in HG II Excess RatiosPercentage Change Due to New Mapping

Hazard Group II - BAverage

Minimum Maximum Difference*$100,000 -10.3% OR -3.0% MD -6.0%$200,000 -14.1% OR -4.4% MD -8.6%$300,000 -16.8% OR -5.0% HI -10.3%$500,000 -20.6% OR -5.6% HI -12.8%

$1,000,000 -25.9% AK -5.4% HI -15.7%$5,000,000 -29.1% AK -5.7% HI -19.0%

Hazard Group II - CAverage

Minimum Maximum Difference*$100,000 1.6% MT 6.7% KS 3.9%$200,000 1.7% MT 8.1% KS 4.8%$300,000 1.7% MT 8.4% KS 5.3%$500,000 1.1% AK 10.2% CT 5.9%

$1,000,000 -0.9% AK 12.5% CT 6.1%$5,000,000 -5.4% AK 13.1% RI 5.4%




-40%

-30%

-20%

-10%

0%

10%

20%

30%

HG B HG C$100K

HG 2 HG B HG C$500K

HG 2 HG B HG C$1M

HG 2 HG B HG C$5M

HG 2

Pe

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Change in HG III Excess RatiosChange Due to New Mapping

Hazard Group III - EAverage

Minimum Maximum Difference*$100,000 (0.038) OR (0.016) RI (0.025)$200,000 (0.040) MT (0.013) RI (0.024)$300,000 (0.039) MT (0.010) RI (0.022)$500,000 (0.036) MT (0.007) RI (0.018)

$1,000,000 (0.027) MT (0.004) RI (0.012)$5,000,000 (0.011) OR (0.001) OK (0.004)

Hazard Group III - FAverage

Minimum Maximum Difference*$100,000 0.031 MT 0.046 CO 0.038$200,000 0.028 IN 0.043 CT 0.036$300,000 0.023 IN 0.041 CT 0.032$500,000 0.017 IN 0.035 AL 0.026

$1,000,000 0.009 OK 0.028 AL 0.017$5,000,000 0.001 AK 0.013 NV 0.005




-0.050

-0.040

-0.030

-0.020

-0.010

0.000

0.010

0.020

0.030

0.040

HG E HG F$100K

HG 3 HG E HG F$500K

HG 3 HG E HG F$1M

HG 3 HG E HG F$5M

HG 3

Ch

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Change in HG III Excess RatiosPercentage Change Due to New Mapping

Hazard Group III - EAverage

Minimum Maximum Difference*$100,000 -8.6% IN -3.1% MD -5.3%$200,000 -10.1% IN -4.2% MD -7.1%$300,000 -12.1% AK -5.0% MD -8.2%$500,000 -15.1% AK -5.4% RI -9.6%

$1,000,000 -18.6% AK -5.1% RI -11.0%$5,000,000 -22.8% AK -5.3% RI -12.2%

Hazard Group III - FAverage

Minimum Maximum Difference*$100,000 5.2% MT 13.4% IN 8.0%$200,000 6.9% MT 16.3% KS 10.6%$300,000 8.1% MT 17.8% IN 12.2%$500,000 9.4% MT 19.1% IL 14.2%

$1,000,000 10.0% AK 22.4% CT 15.8%$5,000,000 4.6% AK 21.4% CT 15.9%




-40%

-30%

-20%

-10%

0%

10%

20%

30%

HG E HG F$100K

HG 3 HG E HG F$500K

HG 3 HG E HG F$1M

HG 3 HG E HG F$5M

HG 3

Pe

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Largest Class Codes Transitioning From III to E

Class Code

DescriptionPremium Size (8810 =

1000)

8742Salespersons, Collectors or Messengers—Outside

453

5190Electrical Wiring—Within Buildings and Drivers

399

5183 Plumbing NOC and Drivers 366

7228Trucking—Local Hauling Only—All Employees and Drivers

325

5221Concrete or Cement Work—Floors, Driveways, Yards or Sidewalks—and Drivers

250


Largest Class Codes Transitioning From III to F

Class Code

DescriptionPremium Size (8810

= 1000)

5645Carpentry—Detached One or Two Family Dwellings

500

7229Trucking—Long-Distance Hauling—All Employees and Drivers

416

5403 Carpentry NOC 289

5022 Masonry NOC 285

3724Machinery or Equipment Erection or Repair NOC and Drivers

272

Documents

Agenda