Pricing groups have by no means had extra inside information. But many nonetheless wrestle to reply a easy query: Are we pricing danger intentionally or drifting out of alignment with the market with out realising it?
We sat down with our Lead Knowledge Scientist, Kalle Myllarniemi, to speak about how our new machine studying capabilities, Apollo and Atlas, got here to life and what they now make attainable.
Q: The place did the thought behind Apollo and Atlas originate?
Kalle:
The start line was scale.
Over the previous few years, we reached some extent the place we’re gathering 600,000 costs per day throughout a number of sectors. That quantity of knowledge essentially modifications what is feasible. If you mix that with the rising variety of manufacturers available in the market and the rising variety of pricing methods, it turns into clear that conventional benchmarking solely tells a part of the story.
Competitors is extra complicated than it was 5 or ten years in the past. There are extra underwriting appetites, extra segmentation methods and extra nuanced score interactions. Pricing has turn into extra multidimensional.
Apollo and Atlas have been born from that intersection of unprecedented information scale and rising strategic variety available in the market. We realised we weren’t simply observing costs. We have been observing behaviours. When you can mannequin behaviour, you may perceive technique.
That was the shift.
Q: What downside have been you seeing available in the market that made this needed?
Kalle:
Pricing groups are exceptionally educated about their very own books. They perceive their score construction, their claims efficiency and their underwriting urge for food in depth.
However they typically have restricted visibility into how others are pricing, significantly in segments they don’t seem to be presently writing.
That creates a structural blind spot.
If you’re not writing a selected danger kind, you shouldn’t have claims information for it. With out claims information, it turns into troublesome to confidently value into that house. That is one purpose insurers can hesitate to broaden urge for food. The uncertainty feels commercially dangerous.
On the identical time, adversarial choice stays a relentless risk. In case your pricing doesn’t precisely mirror how the broader market is segmenting danger, you may find yourself getting chosen towards and attracting dangers that others have intentionally priced away from.
Apollo addresses each points.
It permits insurers to know how the broader market costs dangers that sit outdoors their present footprint. It additionally reveals the range of pricing methods in play. Many pricing professionals know their very own mannequin inside out, however Apollo reveals how weighting buildings, function interactions and segmentation approaches differ throughout the market.
It strikes the dialog from “the place are we priced?” to “how are we positioned?”
That could be a essentially completely different degree of perception.
Q: How did it really feel seeing these propositions go from idea to actuality?
Kalle:
Genuinely thrilling and sometimes humbling.
If you first begin analysing Apollo outputs, they’ll problem assumptions. You may see an insurer displaying considerably much less weighting for licence tenure than the broader market, which initially feels counterintuitive.
However once you interrogate function interactions and clustering, the story begins to emerge. Maybe that insurer is putting a lot stronger emphasis on claims free driving expertise as an alternative. What appears to be like like underweighting in isolation turns into a deliberate strategic commerce off.
That’s when it turns into highly effective.
Apollo doesn’t simply floor variations. It helps clarify them. You begin to see the narrative of various pricing methods take form. Sure insurers lean into expertise alerts, others into tenure, others into postcode granularity or behavioural proxies.
Seeing these patterns crystallise was the second it grew to become clear this was greater than a modelling train. It was strategic intelligence.
Q: What does Apollo really change for pricing groups?
Kalle:
A number of issues.
First, it gives aggregated market fashions, a view of how the market costs danger total.
Extra importantly, it reveals how your pricing construction aligns with or diverges from the principle pricing methods working available in the market. You may see which strategic cluster you most have a resemblance to.
Second, Apollo highlights score components that others look like utilizing closely however you aren’t, and equally, components the place you might be distinctive. That may set off invaluable inside dialogue. Is that this deliberate differentiation or an unintentional hole?
Third, it introduces a market lens on score issue interactions. Pricing doesn’t function in isolation. Components work together. Apollo helps groups perceive how these interactions evaluate with broader market patterns.
Lastly, it gives a check mattress.
If the evaluation highlights a possible alternative, for instance adjusting weightings in a selected phase, insurers can mannequin the affect and look at a earlier than and after place relative to market behaviour. That reduces uncertainty and permits for extra assured implementation of change.
It strikes exterior information from descriptive benchmarking to actionable simulation.
Q: Let’s discuss industrial worth. What modifications in sensible phrases?
Kalle:
In sensible phrases, it improves danger choice and pricing accuracy.
With Atlas, insurers achieve extra granular categorisation of danger, significantly in areas like postcode segmentation. That results in extra correct pricing of location based mostly danger and may straight enhance loss ratios.
Apollo enhances this by making certain score buildings are aligned with observable market behaviour, lowering the danger of adversarial choice.
The mixed impact is sharper aggressive positioning and higher technical efficiency.
It’s not about copying the market. It’s about understanding it properly sufficient to decide on your place intentionally.
That’s the place the industrial worth sits.
The Greater Image
Machine studying in insurance coverage typically focuses on inside optimisation.
Our method focuses on market intelligence.
As a result of sustainable pricing efficiency is not only about constructing higher fashions. It’s about understanding how your pricing logic sits inside a dwell, aggressive market.
Discover the small print behind Apollo and Atlas
Obtain the total info packs to see how market-grounded machine studying can strengthen your pricing technique.
