Rating variable usage has recently generated discussion within the United States, with some states passing legislation controlling the use of certain variables such as gender. “Insurance Rating Variables: What They Are and Why They Matter,” a recent white paper and infographic jointly released by the CAS and Insurance Information Institute (I.I.I.), is recommended reading for anyone looking for an accessible primer on the issue, including federal lawmakers, regulators and the general public. The white paper aims to improve public understanding of how rating variables are used and regulated, and the important role they play in pricing insurance.
Earlier this year, the CAS Board of Directors adopted guidelines enabling the CAS to produce educative statements. Authorizing the production of documents such as the rating variables white paper is a new tool that the CAS will use to further its mission of providing casualty actuarial science education. “CAS educative statements will relate to issues that have emerged in a public forum — issues that the CAS believes call for timely clarification, correction or education as appropriate and desirable,” said CAS President Jim Christie.
The white paper marks the first joint educational statement from the CAS and I.I.I., and it is consistent with both organizations’ missions to educate policymakers, the media and the public with sound, objective information on property-casualty insurance issues.
“I strongly encourage our members to circulate the white paper internally at their own companies,” said CAS President-Elect Steve Armstrong. “Since I shared the paper with my colleagues at Allstate, the paper has been passed along to many different departments. We’ve also added the paper as a resource to our internal library.”
The paper with its accompanying infographic is available from the Casualty Actuarial Society and Insurance Information Institute websites.