System and Method for Valuation, Acquisition and Management of Insurance Policies

• US 20150100353A1
• Filed: 04/02/2014
• Published: 04/09/2015
• Est. Priority Date: 10/03/2013
• Status: Active Grant

• Current Assignee: RISK Transfer IP LLC
• Original Assignee: RISK Transfer IP LLC
• Inventors: Hughes, Paul R., Fabrizio, Dino A.
• Granted Patent: US 10,074,138 B2
• Time in Patent Office: Days
• US Class Current: 705/4
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

A system and method for the valuation, acquisition, and management of insurance policies whereby specific business methods, algorithms, and systems are utilized to measure specific benchmarks set by risk bearers, affiliates and clients. The benchmarks set are based on the ratios set by the risk bearer based on their specific objectives for profitability. Profitability is measured by a number of factors and ratios to include but not be limited to ROI, ROE, Combined Ratio, Expense Ratio, Loss Ratio.

Claims

1. A method of managing profitability of an insurance policy provided to a first client of a professional employer organization (PEO) comprising the steps of:

storing data relating to a PEO client to a database, wherein the PEO client data includes employee class codes and employee geographic location for employees covered by the insurance policy and wherein the PEO client data is associated in the database with the Federal Employer Identification Number (FEIN) of the PEO client;

obtaining real-time payroll data from the PEO for said PEO client wherein said real-time payroll data is associated with the FEIN of the PEO client; and

calculating real-time earned premium data for the insurance policy of the PEO client.

2. The method of claim 1 further comprising the step of calculating real-time profitability for each employee covered by the insurance policy of the PEO client by computing the Combined Ratio using the real-time earned premium data.

3. The method of claim 2 further comprising the steps of calculating the aggregate profitability for the insurance policy provided to the PEO client.

4. The method of claim 2 further comprising the step of generating a visual display of profitability wherein the visual display includes indicators of profitability overlayed on a map.

5. The method of claim 4 wherein the indicators correspond to the aggregate profitability of the policy for all employees of the PEO client that are located in the same ZIP code.

6. The method of claim 2 further comprising calculating real-time earned premium data and calculating real-time profitability for each employee covered by an insurance policy of a second PEO client and providing a visual display of profitability relating to the second PEO client policy.

7. The method of claim 6 further comprising the step of generating a visual display of profitability wherein the visual display includes indicators overlayed on a map that correspond to profitability for the policies covering employees of each of the first and second PEO clients.

8. The method of claim 7 wherein the indicators correspond to the aggregate profitability for the insurance policies for all employees of each PEO client covered by the policies that are located in the same ZIP code.

17. The system of claim 1 wherein the server calculates a weighted severity score, a weighted frequency score and a weighted jurisdictional score relating to the PEO client insurance policy.

18. The system of claim 17 wherein the server calculates a composite score relating to the client policy from the weighted severity score, weighted frequency score and weighted jurisdictional score.

19. The system of claim 18 wherein the server calculates a price for the policy where the composite score exceeds a preselected threshold.

20. The system of claim 19 wherein the server calculates the price for the policy based upon established insurance rates, debit and credit factors, and rating basis.

9. A computer system for managing profitability of an insurance policy provided to a first client of a professional employer organization (PEO), the system comprising:

a server for storing data relating to a PEO client to a database, wherein the PEO client data includes employee class codes and employee geographic location for employees covered by the insurance policy and wherein the PEO client data is associated in the database with the Federal Employer Identification Number (FEIN) of the PEO client;

the server obtaining real-time payroll data from a server associated with a PEO for said PEO client wherein said real-time payroll data is associated with the FEIN of the PEO client; and

the server calculating real-time earned premium data for the insurance policy of the PEO client.

10. The system of claim 9 wherein the server calculates real-time profitability for each employee covered by the insurance policy of the PEO client by calculating the Combined Ratio using the real-time earned premium data.

11. The system of claim 10 wherein the server calculates the aggregate profitability for the insurance policy provided to the PEO client.

12. The method of claim 10 further comprising a display device for displaying a visual representation of profitability wherein the visual representation includes indicators of profitability overlayed on a map.

13. The method of claim 12 wherein the indicators correspond to the aggregate profitability for the insurance policy for all employees of the PEO client covered by the policy that are located in the same ZIP code.

14. The method of claim 10 wherein the server calculates real-time earned premium data and real-time profitability for each employee covered by an insurance policy of a second PEO client and wherein the display device provides a visual display of profitability for the second PEO client policy.

15. The method of claim 14 wherein the display device displays a visual representation of profitability data that includes indicators overlayed on a map that relate to profitability for the policies covering employees of each of the first and second PEO clients.

16. The method of claim 15 wherein the indicators correspond to the aggregate profitability for the insurance policies for all employees of each PEO client covered by the policies located in the same ZIP code.