Colorado requires personal auto insurers to govern and evaluate their pricing tools for racial bias, with the first compliance report due July 1, 2026. Most insurers do not collect race. Here is how evaluation is possible without it, and what separates a credible analysis from a misleading one.
Colorado Regulation 10-1-1
On October 15, 2025, Colorado’s amended Regulation 10-1-1 expanded to cover private passenger auto insurers. It applies a governance and risk-management framework to insurers that use external consumer data, algorithms, or predictive models in pricing, requiring them to evaluate those tools for bias and report to the Division of Insurance, with the first compliance report due July 1, 2026. A more detailed quantitative testing standard for auto is still being finalized. Colorado is not alone: New York’s Insurance Circular Letter No. 7 sets similar expectations, and other states are moving the same way.
That creates a practical problem: auto insurers do not ask applicants their race, nor should they. So how do you evaluate pricing for racial bias when you do not have anyone’s race?
Inferring what you don’t collect
The standard method for approximating race is Bayesian Improved First Name Surname Geocoding, or BIFSG. Names and neighborhoods carry probabilistic information about race and ethnicity, and that information is public, in U.S. Census data. A surname like Nguyen, a first name like Jorge, and the demographic makeup of a ZIP code each shift the odds. BIFSG combines all three into an estimated probability that a given policyholder belongs to each racial or ethnic group.
The output is a set of probabilities across racial and ethnic groups rather than a label on any individual, and over a book of business those probabilities let you compare premiums, losses, and loss ratios between groups and ask whether the pricing treats similar drivers differently. It builds on the same proxy approach the Consumer Financial Protection Bureau (CFPB) has used in fair-lending analysis and that state regulators have used in their own insurance studies. The method itself is well understood; producing results that hold up to a regulator or a court is a different matter, and it is where the actuarial judgment lives.
What rigorous testing has to handle
Three problems separate a credible test from a misleading one, and each can quietly flip the conclusion.
The first problem is the most familiar: a premium difference is not a disparity. A premium gap between groups is not discrimination unless it is larger than the difference in cost behind it. The District of Columbia’s 2024 DISB study illustrates the complexity when it studied auto premiums: minority drivers paid more premium, but their incurred losses ran higher still. The honest yardstick is the loss ratio, incurred losses measured against earned premium, and a credible test still has to separate a real premium gap from one that only reflects where people live or what they drive.
The second problem is subtler, and it starts with the fact that you never observe race at all, only estimate it, and the errors in that estimate are not random. Research on these methods finds that misclassification tracks socioeconomic status, with minorities in higher-income areas more often read as White and White residents in lower-income areas read as non-White. The Society of Actuaries’ 2024 review of imputation methods adds that they identify American Indian, Alaska Native, and multiracial people poorly, and that the Census suppresses counts for rare surnames in a way that falls hardest on smaller groups. A related problem is incomplete matching: when a policyholder’s surname does not appear in Census data, such as frequently happens with compound surnames common in Latino communities, the record cannot be assigned a race probability so it drops from the analysis. Random error would average out over a large book, but this demonstrates that records that drop are actually concentrated in the very groups the test exists to protect. It does not merely add noise, it bends the result, and an analysis that ignores it can produce a clean-looking number that is wrong exactly where it matters most.
The third problem is that the outcome depends on choices for which there is no agreed standard, so the same book can support different conclusions depending on who runs the test. Even the direction of the distortion is contested. Return to that misclassification: suppose Black drivers are in fact charged ten percent more than White drivers of the same risk. Because the imputation misreads some Black drivers as White and some White drivers as Black, each estimated group becomes a blend of the two, and the measured gap comes out smaller than the true ten percent. The disparity is real, but the proxy dilutes it, and a test taken at face value understates it.
That is the most common way imputation distorts the answer, but not the only one. Several fair-lending studies have found the reverse, that it can overstate disparate impact when the errors fall unevenly and invent gaps that were never there. The field genuinely disagrees about which way the bias runs, and the answer turns on how the proxy is built and used. That is not a reason to distrust the work; it is a reason to fix the methodology in advance, document it, and check whether the conclusion holds when the choices change.
Test for fairness pricing now
The July 1, 2026 Colorado compliance deadline for bias testing in personal auto insurance marks the beginning of documentation standards and annual reporting requirements.
Colorado’s regulation may signal where other jurisdictions are headed to ensure fairness in personal lines pricing. If your company uses external data, insurance credit scores, algorithms, or predictive models, it is worth assessing your program for potential discriminatory impacts across protected classes now.
Perr&Knight has the experience and expertise to provide this bias-testing analysis end to end: the data engineering and the testing that separates a real disparity from a cost-justified difference. Reach out to our consulting actuaries to provide the insights you need to ensure fair pricing in your personal lines insurance programs.
Society of Actuaries, Statistical Methods for Imputing Race and Ethnicity, April 2024. https://www.soa.org/globalassets/assets/files/resources/research-report/2024/stat-methods-imputing-race-ethnicity.pdf
DC Department of Insurance, Securities and Banking, Evaluating Unintentional Bias in Private Passenger Automobile Insurance, November 2024. https://disb.dc.gov
By Bradley Jones, Senior Actuarial ConsultantPerr&Knight
Wildfire risk has moved from a regional concern to a central issue in property insurance ratemaking. Loss experience is changing, capacity is constrained in several western states, and a new wave of regulation is taking shape around how insurers assess and price wildfire exposure. Colorado’s House Bill 25-1182 is one of the clearest recent examples of where this regulatory trend is heading, and insurers writing property business in wildfire-exposed states should be preparing now. In this guide, we explore how carriers can navigate complex regulatory environments, like Colorado’s HB 25-1182, while leveraging advanced wildfire risk modeling to maintain rate adequacy.
Regulation and advances in wildfire risk modeling can work together to support rate adequacy for wildfire risk.
Key Trends: Rising Wildfire Risk and Insurance Pricing Impacts.
Wildfire activity has increased significantly over the past several decades, with long-term trends showing substantially greater acreage burned across much of the western United States. Additionally, the share of acreage burned at high severity is rising1. Taken together, the data points to a shift in the historical wildfire loss distribution – meaning the historical wildfire data increasingly understates prospective risk.
The market impact is most visible in states with significant wildland-urban interface (WUI). In Colorado, average homeowners insurance premiums have increased substantially over the past decade, placing the state among the most expensive in the country. The Colorado FAIR Plan, launched in April 2025, was established in direct response to availability and affordability pressures in the residential market. The FAIR Plan’s creation underscores the extent to which traditional ratemaking and underwriting approaches have struggled to keep pace with current risk. California faces similar pressure from projected increases in wildfire risk, as wildfire exposure continues to affect property insurance pricing and availability in high-risk regions. For example, California’s FAIR Plan, the state’s insurer of last resort, has seen a surge in new policies written and total written premiums for high-risk properties.
Colorado HB 25-1182: The Next Step in Regulation
Colorado’s HB 25-1182, Risk Model Use in Property Insurance Policies, takes effect July 1, 2026. The legislation is focused on transparency, accountability, and the role of mitigation in wildfire pricing for homeowners and other property insurance lines.
Under the act, any insurer that uses a wildfire risk model, catastrophe model, or scoring method to influence whether a policy is written and/or how much a policy costs, must:
Include in its rate filing a description of the model, its impact on rates, and an explanation of how it is used in underwriting decisions.
Incorporate property-level and community-level mitigation activities into the model or the underwriting process.
Post on the carrier’s public website the discounts, incentives, or adjustments available to policyholders who undertake mitigation efforts.
Provide an annual written notice to each policyholder of their wildfire risk score and an explanation of how that score and any mitigation efforts impacted the rate or premium.
The Colorado Division of Insurance (DOI) has pending Regulations 5-1-28 and 5-1-29, which, if adopted, would provide compliance guidance to insurance carriers for HB 25-1182.
Other States Are Moving in the Same Direction
California has already implemented a comprehensive set of reforms through its Sustainable Insurance Strategy, aimed at modernizing ratemaking, improving market availability, and addressing wildfire risk through approved use of wildfire models and the net cost of reinsurance in rate filings.
While California and Colorado have taken the most comprehensive regulatory actions to date, several other western states are moving in a similar direction. Montana has enacted insurer disclosure requirements and authorized mitigation discounts. Oregon has utility wildfire mitigation plan requirements in place, a measure that often serves as a precursor to broader insurance regulation.
Our expert actuarial consulting for property insurance expect the pace of state-level wildfire regulation to continue, particularly in states where catastrophe losses are putting pressure on rate adequacy and market availability.
The Role of Advanced Wildfire Risk Modeling
In many respects, these regulatory changes mirror broader shifts already taking place in catastrophe modeling and property ratemaking. Advances in wildfire risk modeling now allow insurers to move beyond traditional, territory-based approaches toward more granular, property-level risk assessment. These tools directly support transparency, mitigation-credits, and policyholder-notice requirements embedded in HB 25-1182.
Implementing wildfire scoring into a rating plan is much more than a modeling exercise. Carriers also need adequate filing support, mitigation credits, model governance, and consistency between underwriting rules and rating algorithms. Regulators are focused not only on predictive accuracy, but also on whether insurers can clearly explain how wildfire models affect individual policyholders.
How Perr&Knight Can Help
For insurers writing business in wildfire-exposed regions, the challenge is more than just catastrophe exposure. Colorado’s HB 25-1182 illustrates how carriers must now be prepared to support model-driven pricing decisions through filings, disclosures, mitigation programs, and policyholder communications.
Perr&Knight combines actuarial and product expertise, regulatory insight, and significant Colorado support for property rate filings and regulatory compliance to help insurers build wildfire pricing strategies that are actuarially sound, compliant with HB 25-1182, and adaptable to the next wave of state regulation.
1 Parks, S. A., Coop, J. D., & Davis, K. T. (2025). “Intensifying Fire Season Aridity Portends Ongoing Expansion of Severe Wildfire in Western US Forests.” Global Change Biology, 31, e70429. https://doi.org/10.1111/gcb.70429.
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Want to make a billion dollars in insurance? Figure out how to write California homeowners insurance profitably at an affordable premium. Want to waste your time and money? Try to replace actuaries with AI.
Yet several well-funded startups, backed by tens of millions of dollars, are effectively trying to do just that. Why are they pursuing this, and what don’t they understand?
It starts with a fundamental misunderstanding of what actuaries actually do, and what can and cannot be materially improved by AI. Much of the current buzz assumes that the time-consuming parts of actuarial work are mechanical: gathering and loading data, building models, and selecting parameters. They are not. Actuaries have been performing these functions with increasing efficiency for decades, without AI.
The real work begins after the analysis. Why did you make that assumption? Would another actuary reach the same conclusion? What does the result imply for the business? Who needs to understand it, and what actions should follow? These questions, including documentation, communication, governance, and ultimately judgment, define actuarial value. They are not mechanical, and they are not easily automated.
AI has a role to play. In many areas, it can be quite valuable. But the idea that AI will replace actuaries or fundamentally change core actuarial decision-making reflects a misunderstanding of where the real risks and opportunities lie.
Where AI Won’t Help
Actuaries are already highly efficient at building analytical models, particularly in spreadsheets and other pre-built actuarial modeling tools. Excel, for all its limitations, remains an extraordinarily powerful tool in experienced hands. Models can be built quickly, iterated on easily, and understood by peers. Having AI generate spreadsheets may save some setup time, but it does not materially improve the speed or quality of actuarial analysis. At best, it is incremental. At worst, it introduces unnecessary complexity that makes models harder to review and validate.
Data ingestion is also not the bottleneck many assume. Mature processes already exist, ranging from simple structured file imports to SQL pipelines and ETL workflows to built-in functions in Snowflake and Databricks, that efficiently move and organize data for analysis. While data quality can always improve, AI does not represent a step change relative to well-designed conventional approaches.
Most importantly, AI does not replace actuarial judgment. The selection of development factors, trend assumptions, credibility weights, and methodologies require experience, context, and accountability. These decisions involve interpretation and trade-offs, not just computation. No serious practitioner is delegating them to AI, and it is difficult to imagine management or regulators accepting that approach.
Where AI Adds Value
AI creates value when it is embedded within structured, (human-designed) workflows, not when it is used as a standalone or ad hoc tool.
Within a structured workflow, validation is one of the clearest opportunities. AI tools can review spreadsheets and models to identify inconsistencies, errors, and anomalies. Even experienced actuaries make mistakes in complex models, and an additional layer of review can meaningfully improve confidence in results.
AI is also effective at interpreting unstructured data. Policy language and reinsurance contracts are good examples. These documents are often dense and complex, yet they must be translated into structured inputs such as limits, attachments, effective dates, and claim triggers for modeling. AI can assist in extracting these elements and mapping them into structured model parameters within a defined system. With actuarial oversight, this can significantly improve efficiency.
Documentation is another area of value. Actuarial consulting work often lacks consistent explanations of assumptions, methodologies, and data sources. AI can help backfill this information within a controlled workflow, improving transparency and auditability. In a regulated environment, which is a meaningful benefit.
It is also important to distinguish between AI and automation. They are not necessarily the same. Conventional automation, building software to perform repeatable actuarial functions, has been evolving for decades and will continue to do so. These solutions are tried and true and add tremendous efficiencies and it makes no sense to try to replace these with AI-based solutions. On the other hand, AI can accelerate the process of creating these applications. Tools that assist in coding and development can materially increase the speed at which actuarial models and workflows are built, automated, and improved.
That is quite different from the idea of an AI agent accessing (proprietary) data, building its own actuarial models, selecting assumptions, and producing a report without any structured system or oversight. One is an extension of disciplined engineering. The other is a breakdown of it.
Where AI Introduces Risk
When used outside of structured systems and controls, AI can actually make actuarial work worse.
The most significant risk is the move toward black-box models. Replacing transparent, well-understood analyses with opaque AI-generated outputs is a step backward. Actuarial work requires explainability. Results must be defensible to management, auditors, and regulators. Black-box models, no matter how sophisticated, undermine that requirement.
AI can also lead to overly complex models. Automatically generated spreadsheets or code can introduce layers of logic that are difficult to trace and validate. Complexity without clarity is not an improvement. It is a liability.
There is also the issue of false confidence. AI-generated output often appears polished and complete, which can mask subtle errors. In actuarial work, small mistakes can compound into large financial or regulatory consequences. A model that looks right but is wrong is dangerous.
There are also real security and data governance concerns. Actuarial work often involves sensitive financial and policyholder data. Careless use of AI tools can expose that data in ways that are difficult to detect and even harder to remediate.
The Right Direction
If AI is not the solution to everything, what does an optimal actuarial model look like?
It starts with structure. Data should flow from core systems into a standardized, normalized database with built-in validation and visualization tools (perhaps including AI-based tools). From there, pre-built analytical engines that implement established actuarial methods operate on that data. These models should be transparent, repeatable, and subject to version control.
Actuaries then apply professional judgment within this framework by making assumptions, adjusting parameters, weighing the relative value of each method, and interpreting results. This remains the core of the profession.
Policy terms and other inputs can be structured and fed into the system, with AI assisting in interpretation and ingestion where appropriate. The result is a workflow that is automated where it should be, but still controlled, transparent, and auditable.
In this model, AI plays a supporting role within the system. It enhances validation, improves documentation, accelerates development, and assists with data extraction. It does not replace the system, and it does not replace actuarial judgment.
Much to the chagrin of the AI-Actuary startups, humans will not augment systems designed by AI. AI will operate within systems designed by humans.
Conclusion
The idea that AI will handle actuarial work from start to finish is not a vision. It is a misunderstanding of where the real work and risk reside. Firms whose business plan is premised on this assumption will fail.
The challenge in actuarial work has never been performing the math. It has been ensuring that data is reliable, models are validated, structured and transparent, and decisions are made with sound judgment and accountability.
AI can help, and in some cases meaningfully. But it is not a substitute for the systems, controls, and expertise that underpin actuarial work.
Insurance firms that succeed will not be those that try to replace actuaries with AI. They will be the ones that build better systems (automated when practical) that are structured, governed, and scalable, and then use AI to enhance those systems in targeted, practical ways.
As we launch this newsletter, it’s worth addressing a practical question many insurance organizations are actively considering: Should we build, buy, or rethink our current approach to regulatory compliance operations?
For many carriers, fronting companies, MGAs, and program managers, the default answer has historically been some combination of homegrown systems, state platforms like SERFF, bureau-generated materials and guidance, and single-purpose tools layered together over time. Historically, that approach worked reasonably well. But as organizations grow, expand into new states, and increase product complexity, the limitations become more apparent.
Homegrown systems, while tailored and often built with current technology, come with an ongoing burden. They require continuous internal investment, compete with other IT priorities, and depend heavily on a limited number of individuals who understand how they work. Enhancements are slow, regulatory updates require constant attention, and over time, the system becomes harder, not easier, to improve and scale.
Single-purpose tools offer a different tradeoff. They can improve a specific step in the process, but they rarely solve the broader problem. Instead, they introduce additional handoffs, often require duplicate data, and create new integration challenges. What begins as an efficiency gain in one area frequently creates inefficiency somewhere else.
Even when these approaches are combined, the result is typically the same: fragmented workflows, inconsistent data, and heavy reliance on manual coordination to fill gaps—especially around communication among stakeholders. That may be manageable at smaller scale, but it becomes a constraint on growth and a source of operational risk over time.
Licensing a platform like PK1Cloud represents a fundamentally different approach.
Rather than each organization building and maintaining its own environment, PK1Cloud centralizes that effort. Development, enhancements, bug fixes, and regulatory updates are handled once and delivered across the platform. This not only reduces cost, but ensures that the system is continuously improving and staying current with changing requirements.
At the same time, PK1Cloud is designed as an integrated operating platform, not a collection of tools. It brings together secure, centralized data, standardized workflows (which can be tailored to fit each organization’s needs), automated communication, broad integrations, and guardrailed AI within a single environment. The result is greater consistency, better visibility, less enterprise risk, and the ability to scale operations without a corresponding increase in complexity.
From a strategic standpoint, the decision is less about technology and more about focus. Organizations that choose to build and maintain their own systems are, in effect, taking on a software development business alongside their core insurance operations. Those that adopt a platform approach can redirect that time, capital, and talent toward core operational initiatives.
That is ultimately the value proposition of PK1Cloud: a more efficient, scalable, and durable way to operate in an increasingly complex environment.
Read on for a closer look at how PK1Cloud delivers these capabilities in practice.
Tim Perr, Chief Executive Officer
PK1Cloud Is Now Live.
Did you know that Perr&Knight has launched PK1Cloud, a unified operating platform designed to modernize and streamline Property & Casualty insurance operations?
PK1Cloud brings together analytics, product design, and compliance within a single, integrated environment. Built on Perr&Knight’s 30+ years of industry expertise, the platform is purpose designed to address the operational and regulatory complexity faced by insurers, program managers, and alternative risk finance organizations.
At its foundation, PK1Cloud aligns three critical dimensions of P&C operations: process, data, and communication.
From a process standpoint, PK1Cloud replaces fragmented, manual workflows with standardized, automated, AI-enabled applications. This reduces operational risk, removes single points of dependency, and improves consistency and control across the organization.
From a data perspective, PK1Cloud establishes a secure, enterprise-wide single source of truth. Built in versioning, validation, visualization, and integration capabilities ensure decisionmakers are working from accurate, trusted information—supporting transparency, scalability, and auditability.
Equally important, PK1Cloud enables more effective collaboration. Intelligent workflows and calendar-aware automation help teams manage dependencies, meet regulatory deadlines, and maintain alignment across stakeholders and functions.
Lastly, we are always adding to and improving the platform; PK1Cloud is designed for long-term evolution. The roadmap for 2026 includes an expanded forms library and the continued rollout of secure, purpose-built AI enhancing insight and decision-making while protecting client confidentiality and data integrity.
The objective is straightforward: to help organizations operate faster, with greater accuracy and confidence. PK1Cloud is a scalable foundation for continuous improvement and sustainable operational excellence in modern P&C insurance.
We invite you to explore PK1Cloud on our website to learn how we are redefining insurance operations.
Bob Cericola, Director, PK1Cloud
StateFilings.com Is Now PK1Cloud Filings.
Did you know that StateFilings.com is now PK1Cloud Filings and is now an integral part of the broader PK1Cloud software ecosystem?
PK1Cloud Filings continues to deliver the structured regulatory workflow capabilities clients rely upon, and is now aligned with Perr&Knight’s vision for coordinating regulatory work across the enterprise.
At its foundation, PK1Cloud Filings is built around a project-based structure that strengthens accountability and execution. Rather than managing filings in isolation, teams organize work into countrywide initiatives and monitor state-by-state progress from a centralized view. Defined process ownership, automated reminders, and centralized project tracking reduce regulatory risk and create more predictable execution across jurisdictions.
The platform also improves visibility across the organization. Real-time status updates, dashboards, reporting tools, and notifications allow actuarial, product, compliance, and leadership teams to track regulatory progress without relying on manual updates or disconnected tracking methods. This shared visibility improves coordination and decision making.
Looking ahead, PK1Cloud Filings will further integrate with other PK1Cloud applications, strengthening the connection between product development, actuarial work, and regulatory filings. This integration will streamline the transfer of product content such as forms, rates, and rules into the filings workflow within a fully auditable system. PK1Cloud Filings will also continue expanding secure AI capabilities designed to protect client data while improving efficiency and accuracy.
The transition to PK1Cloud Filings reflects Perr&Knight’s continued investment in modern regulatory operations, enabling organizations to move from tracking filings to managing regulatory execution at scale.
Did you know that PK1Cloud includes an application designed to help insurers develop and manage their products? Introducing PK1Cloud Product.
Rather than relying on disconnected spreadsheets, document repositories, and manual tracking, Product brings forms, rates, rules, and regulatory intelligence together within one unified platform. The result is a more structured, collaborative, and transparent approach to product development.
PK1Cloud Product supports the entire insurance product lifecycle — from drafting and redlining to review, approval, and finalization. Teams work within a centralized, controlled workspace featuring version management, audit trails, and streamlined workflows. Regulatory insight is embedded directly into the drafting and review process, helping improve accuracy, reduce rework, and strengthen alignment across product, legal, compliance, and filings teams.
Product will continue to expand in 2026. Our roadmap includes access to state-specific checklists, transmittals, and required supporting documentation, enabling teams to prepare and manage filing materials in one place. Advanced comparison tools will allow users to evaluate differences in language, structure, and regulatory requirements across versions and jurisdictions. Secure AI-powered drafting, compliance checks, and intelligent document comparison will further enhance speed, precision, and insight.
PK1Cloud Product reflects our commitment to building a connected ecosystem designed to make insurance product development faster, more consistent, and more confident.
Bob Cericola, Director, PK1Cloud
PK1Cloud Has Reporting Built for the Real World.
Did you know that PK1Cloud Reporting is a powerful application designed to handle the complexity of statistical reporting?
PK1Cloud Reporting delivers reliable, compliant, bureau-ready results and is built specifically to manage the messy realities of client data while transforming it into clean, regulated data extracts. The platform ingests clients’ raw source data in multiple formats and sources and then aligns it to the specific requirements of each bureau and data collection organization. Whether it’s ISO, AAIS, MACAR, or NCCI, PK1Cloud Reporting is built to support reporting across jurisdictions and organizations with confidence.
When source data changes, updates do not require a development cycle. Teams can adjust core lookup table mappings directly, keeping reporting on track without delay.
For clients who prefer automation, PK1Cloud Reporting can securely pull or push files from a client managed repository, reducing manual steps and improving consistency.
Looking ahead, the 2026 roadmap includes key initiatives designed to reduce costs, increase data accuracy, and further streamline statistical reporting operations.
You can count on PK1Cloud to stay ahead of evolving statistical reporting requirements so your team can focus less on compliance risk and more on delivering value.
Nathan Dumont, Product Owner, PK1Cloud Software
Your Subscription Includes Monthly Customer Success Check-Ins.
Did you know that monthly check-ins with the PK1Cloud Customer Success Team are more than routine status meetings, they’re a dedicated opportunity to ensure you’re getting the most value from your PK1Cloud products while staying ahead of change?
These sessions are structured around your priorities. Time is set aside to answer questions, review top-priority or high-severity Service Desk tickets and align on what matters most to your team in the moment. Rather than reacting after an issue escalates, these conversations help proactively address needs before they become obstacles.
Monthly check-ins also provide early visibility into the PK1Cloud roadmap.
Customer Success Team Reviews offer regular opportunities to provide subscribers with demonstrations of recently released features, as well as share insights into upcoming enhancements and explain how new functionalities can be applied to real-world regulatory workflows. This allows you and your team to prepare for changes, adjust processes in advance, and adopt new features with confidence.
Just as importantly, these meetings create space to review existing processes and workflows. With a broad view of how customers across the industry use PK1Cloud, Customer Success Team Reviews can help identify efficiencies, reduce manual steps, and suggest better ways to accomplish everyday tasks using tools you may already have available. Small workflow improvements (such as view customizations, alert usage, or permission adjustments) often result in meaningful time savings over time.
Customers who participate consistently tend to see faster issue resolution, stronger feature adoption, and smoother regulatory operations.
If you’re not currently taking advantage of monthly check-ins, the Customer Success Team is happy to help get them scheduled and tailored to your needs.
Dana Pagliarulo, Director, PK1Cloud Software
PK1Cloud Is Built Around a Seamless User Experience.
Did you know PK1Cloud brings multiple applications together under one platform, and the user experience is intentionally designed to feel that way? A powerful ecosystem only delivers its full value when the interface is simple, consistent, and easy to navigate. That’s why our “One Experience” philosophy is grounded in thoughtful UI and UX design.
In 2026 we are aligning layouts, navigation structures, and visual elements across every application within PK1Cloud, creating a cohesive design language. Whether you’re working in Filings, Product, or Reporting, the platform looks and feels familiar and connected. Users shouldn’t have to re-learn the system; as they move between services, transitions are designed to feel natural and seamless.
By strengthening visual consistency and simplifying workflows, we reduce cognitive load and make it easier to focus on meaningful work. Clear dashboards, predictable navigation, and standardized interactions help teams move faster and operate with greater confidence.
Every update now moves in the same direction, toward a clearer and more cohesive experience across PK1Cloud.
This workflow reflects our commitment to building a unified system — one designed not only to support your work, but to make it more efficient and enjoyable.
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Introduction: The Coming Transformation of Rate Filings
For too long, the rate filing process has depended on people rather than systems. Every insurer has lived with some version of the same problem: a small group of analysts and actuaries who “know how it’s done,” spreadsheets scattered across shared drives, and institutional knowledge that travels with employees when they change roles or leave. The result is fragility with single-point dependency risk and a chronic lack of a single source of truth for filings data, documentation, and workflow history.
Even with the introduction of insurance state filings software like SERFF in the early 2000s and its upcoming “modernization,” this issue remains unresolved. SERFF’s mandate is deliberately narrow, designed to facilitate transmission of filings between insurers and regulators, not to manage the broader, interconnected product development and filing lifecycle. Because it primarily serves state departments of insurance, it offers little help with the internal and cross-functional workflows that dominate the filing process. And even if its new version proves more efficient for filers, it will inevitably fall behind in the fast-moving technology cycle we now inhabit.
Complicating matters, filings touch several major functions within an insurance organization. Actuarial, compliance, marketing, claims, and IT all need to know what is being filed, what the filing introduces or changes, and when those changes will take effect. During the filing process, multiple areas may also need to support regulatory activities, including preparing actuarial exhibits, drafting form changes, and responding to regulatory inquiries. Without integrated systems, these interactions are often disjointed, relying on ad hoc communication and manual tracking.
The real transformation will come from integrated, intelligent systems that combine automation, analytics, and AI. These technologies will not only eliminate manual tasks like uploading, indexing, and data entry, they will also centralize knowledge, coordinate stakeholders, assist with compliance, and preserve a continuous institutional memory from concept to approval. As insurers evolve, filings will no longer depend on a key employee’s knowledge or disconnected spreadsheets. Instead, they will flow through unified insurance state filings software platforms that are fast, highly automated, and resilient—where expertise is amplified by technology and data resides uniformly in one system rather than scattered across disparate drives (or filing cabinets).
At Perr&Knight, this vision is reflected in the development of PK1Cloud, a unified digital platform built to address precisely these challenges and lead the industry toward a smarter, more connected future.
The Inefficiency of Today’s Filing Process
Despite decades of incremental improvements, the filings process remains one of the most labor-intensive, fragmented, and risk-prone activities within the insurance industry. For many organizations, more than half of the time and effort spent on a filing has nothing to do with actuarial analysis or regulatory interpretation; it is consumed by manual mechanics such as uploading documents, indexing exhibits, entering data into SERFF, tracking correspondence, and maintaining version control. Each of these tasks creates opportunities for delay, inconsistency, or error.
Because most companies rely on a patchwork of shared folders, email threads, and spreadsheets, even simple filings can require extensive coordination to confirm which version of a document is current or whether an exhibit was approved.
This fragmentation extends beyond the filings team itself. Product managers, actuaries, compliance staff, marketing, claims, and IT all depend on accurate, timely information about what’s being filed and when. In addition, critical components of the filing process—such as reviewing state insurance codes and comparing proposed filings to competitor submissions—are still largely manual exercises. These activities are essential for compliance and competitive positioning, yet they consume significant time and are highly susceptible to human oversight. With structured data and AI, both can be automated or accelerated, allowing teams to focus on interpretation rather than repetition.
The inefficiency is compounded during regulator interaction. Preparing responses to inquiries or objections frequently requires recreating or re-collecting the same data, exhibits, and rationale because the supporting material isn’t centralized. This often includes the same time-consuming steps of verifying code requirements or researching competitor filings to justify a company’s position. Institutional knowledge about past filings, including why decisions were made, what worked, and what didn’t, often disappears when employees move on, i.e., traveling knowledge risk.
Today’s process is workable, but it’s fragile. It relies on human continuity rather than system continuity, and on institutional memory rather than data intelligence. Until that balance shifts, insurers will remain constrained by legacy workflows that limit speed, accuracy, and adaptability.
From Automation to Integration: The Next Leap
Technology, including AI, will dramatically reduce the time and effort required to create, submit, and support rate, rule, and form filings. Much of today’s filing workload can be fully automated through integrated systems and insurance state filings software.
What once required days of effort will be completed in hours, freeing actuaries, product experts, and compliance professionals to focus on higher-value work such as pricing strategies and product innovation. Intelligent systems can generate exhibits, align documentation, and produce outputs in the exact structure required by regulators, improving accuracy and consistency while reducing rework.
Fully integrated filing environments take this a step further by connecting every stage of the process—preparation, review, submission, and regulatory response—within a single system. The process becomes visible, traceable, and consistent, transforming what has historically been a fragmented, manual function into one that operates with manufacturing-like discipline and data-driven accountability.
From Silos to Systems: Coordinating Stakeholders
Every filing touches multiple teams, and each has a distinct interest in what’s being filed and when. Marketing teams need to know what is being filed and when it will go live so they can prepare producer communications and policyholder notices. Claims needs visibility into coverage changes that could affect claim-handling procedures. The IT department must know which rate tables, rules, and forms are being revised so that the rating and issuance systems can be properly programmed and tested.
In the current environment, this coordination often depends on meetings, emails, and personal follow-up, which can be a slow and error-prone process. Modern, integrated filing systems, by contrast, allow for automated notifications, integrated calendars, and dependency tracking. Each department can see precisely what stage the filing is in, what it changes, and when implementation is expected. This ensures synchronization across the organization, reduces operational risk, and shortens the cycle from regulatory approval to market launch.
By connecting stakeholders through shared data and automated communication, the organization gains operational alignment where everyone is working from the same playbook, at the same pace, toward the same deadlines.
Archival and Institutional Memory
A modern state filings system doesn’t just manage filings; it remembers them. Unlike SERFF’s static, PDF-based recordkeeping, an integrated insurance state filings software platform can archive the entire workflow: correspondence, analyses, internal notes, version histories, decision rationales, and even bureau adoptions. This is far more valuable than a simple record of what was filed. It is a dynamic record of how it was done.
Such a system creates true institutional memory, enabling teams to retrieve not just the final product but the reasoning behind it. Future filings can draw upon this archive to anticipate regulatory questions, reuse templates, and ensure consistency across states and product lines. It transforms recordkeeping into knowledge management.
Building Resilience: Eliminating Single-Point Dependency
Modern filings platforms also strengthen organizational resilience. By systematizing the process, they remove single-point dependency risk: the exposure that arises when institutional knowledge resides in a single individual or small team. Insurance state filings software replaces this vulnerability with a single source of truth that is always accessible, always current, and always auditable.
The benefits extend beyond risk mitigation. When data, exhibits, and correspondence are centrally stored and version-controlled, employees can transition between roles without disrupting operations. Knowledge no longer travels with individuals; it stays with the organization. This continuity enhances both efficiency and governance, ensuring that expertise compounds over time.
The Human Factor: Evolving Roles
As automation handles the mechanics, the human role in filings will shift toward interpretation, judgment, and oversight. Actuaries will focus less on producing exhibits and more on validating assumptions and communicating analytical insights. Compliance experts will spend less time chasing documents and more time shaping strategy. Product teams will gain more bandwidth for innovation because their filing support will be faster and more reliable.
In this model, technology doesn’t replace expertise; it amplifies it. The professionals who understand the regulatory and actuarial nuances will remain indispensable, but they will operate in an environment that enables their insights to scale.
Conclusion: The Reimagined Filing Ecosystem
The next decade will redefine how rate filings are done. The combination of automation, integration, and AI will transform the process from a collection of disconnected manual tasks into a unified, intelligent workflow. Insurers that embrace this transformation will see faster cycle times, fewer errors, greater compliance, and ultimately a sustainable competitive advantage.
For regulators, modern insurer compliance systems will yield a clearer, more data-driven view of the filings they review, enabling faster approvals and more consistent oversight. For insurers, it will mean a world where filings are not just faster—they’re smarter. Compliance will be embedded, not appended, and systems (not solely people) will safeguard important knowledge.
At Perr&Knight, this vision is already coming to life through PK1Cloud, our unified platform designed to simplify complexity across the entire product and filing lifecycle. PK1Cloud centralizes data, automates key workflows, communicates key milestones to all stakeholders, and integrates AI-driven analytics to enhance accuracy, speed, and compliance. It also connects with trusted third-party data sources for insurance code validation and competitor rate and form filings, enabling real-time benchmarking and compliance verification.
The filings process has long been viewed as a necessary administrative burden. While regulation will always remain a fundamental part of the insurance landscape, the burden it imposes can be reduced. With solutions like PK1Cloud, that reduction is not theoretical—it’s already underway. Intelligent, integrated systems are transforming filings from a back-office necessity into an efficient capability that strengthens compliance, accelerates innovation, and connects insurers and regulators in a continuous cycle of improvement.
Contact us today to learn more about how Perr&Knight’s proprietary insurance state filings software, PK1Cloud, can help your organization get a head start on the future of filings.
Benjamin Franklin once stated, “An ounce of prevention is worth a pound of cure.” This is certainly the case when submitting an insurance filing to a State Department of Insurance (“DOI”). Preparing a meticulous and comprehensive submission can help mitigate issues, but it doesn’t necessarily eliminate the possibility of objections from the DOI.
Objections arise for various reasons, including but not limited to regulatory changes, interpretation differences, and jurisdictional nuances. When the dreaded form or rate interrogatory is received, here are some best practices from our experienced insurance filing support teams.
Don’t panic
Despite your best efforts to submit a complete, comprehensive filing, it is always possible that you will receive objections from one or more DOIs. The more lines of business you write and the more jurisdictions you operate in, the more likely you are to receive an interrogatory. Each DOI has specific filing and supporting documentation requirements – some with commonalities. Accepting objection letters and responding promptly are simply processes that enable you to move quickly, adjust the filing, and move closer to approval.
Read carefully and respond thoroughly
If an objection is not answered correctly, it will delay the filing’s approval. Thoroughly read each objection and only answer the question asked. Each objection should be responded to professionally, clearly, and concisely. The response should be complete and provide adequate supporting documentation, but without providing extraneous answers that may not be relevant to the respective objection. Submit your response for peer review or return to it with fresh eyes to confirm all the above have been addressed.
Make it easy for the reviewer
Provide necessary documentation in a manner that is easy for the regulator to address each interrogatory sufficiently. Logically rename file attachments and reference file names within the responses, where applicable.
If you revised a form, rating, or other piece of supporting documentation based on an objection, make a clear note in your response (e.g., “XYZ document has been revised and is attached [see FILE NAME] and replaces the first version of the same document.”)
In short, make it straightforward for the reviewer to follow the changes from the initial submission to the objection to the revision.
Reach out
Statute interpretations vary by jurisdiction, so a lack of understanding of why you did not fulfill a regulatory requirement does not necessarily indicate a shortcoming on your part. Not only are some statutes interpreted differently across regions, but the wording is sometimes vague.
If your objection letter contains an item you don’t understand, do not be afraid to contact the DOI directly, either through email, phone, or video call. Discussing the objection via video call has benefits, especially if you have received the same objection multiple times. Putting a face to a name and connecting personally with a person at the DOI can help you quickly clarify what you need to correct so the approval process doesn’t stall.
Track dates meticulously
Responding to the objection(s) by the date provided by the regulator is important. Response(s) not received by the due date could result in additional delays in the filing (e.g., disapproval). However, if you believe you will require more time than the state allows, submit an extension request as early as possible to give the reviewer time to assess and issue a revised due date. Note that some states have limitations on when extensions must be requested and how many extensions may be allowed.
Keep files and correspondence organized
Before submitting the responses and supporting documentation, ensure all documents are organized and correctly attached. Always double-check responses for accuracy and completeness, making sure you have read all pages of the objection letter (a common mistake is failing to see and respond to questions on subsequent pages). It is also important to submit the information as requested by the regulator (e.g., as part of the response, SERFF Supporting Documentation).
Leverage technology to stay organized. Tracking software like StateFilings.com was explicitly developed to align with the insurance state filings process, enabling users to store and track submissions, due dates, correspondence, and supporting documents in a central, secure repository. Two-way integration with SERFF allows users to post filings to each state, receive communications directly from DOIs, and track due dates – all in one place.
Stay professional
Responding to objections might cause frustration, but always reply to interrogatories with a cooperative attitude. Don’t take the objection personally. At the end of the day, the regulator is just doing their job. In any communication, written or verbal, treat the regulator with respect. Remember, regulators share your objective of arriving at an approved submission. Using a kind tone demonstrates professionalism, which opens the door for further communication.
Research
It can help to review previouslyapproved filings and search for responses to similar objections. If you use an example of a previously approved filing, be prepared, as the filing may have been approved in error. While a level playing field among companies is important, each filing must be looked at on a case-by-case basis. If the previously approved filing language is a clear-cut violation of a statute, administrative rule, or commissioner’s order, the DOI may respond that it will ask the approved company to file and correct the approval error.
Rely on experts
Managing multiple filings across all jurisdictions is a logistical challenge for insurance companies at every scale. Partnering with actuarial consulting and insurance filing support teams like the experts at Perr&Knight can save time, clear up questions, and accelerate speed-to-market. Our industry veterans possess decades of experience submitting filings in all 51 U.S. jurisdictions across all lines of business. Leveraging this expertise can help streamline your filings. We can provide guidance at any stage of the state filings process, including support for objections to filings we did not initially submit. We’re here to help at any point in the process – even under tight deadlines.
It’s crucial to anticipate potential areas of concern and address them proactively to minimize delays and ensure a smooth approval process. When responding to the DOI’s objections, especially the “tough” interrogatories, it is essential to be thorough, clear, and prompt. By following these strategies, you can effectively respond to filing interrogatories and enhance the likelihood of a favorable outcome.
Artificial intelligence holds tremendous potential for insurance companies, promising gains in efficiency, decision-making accuracy, customer experience, and competitive positioning.
For many insurers, however, the path to realizing these benefits remains unclear. Common roadblocks include uncertainty about where exactly to start, how to prioritize initiatives, and how to manage the technical, operational, and regulatory challenges that accompany AI initiatives.
This resource helps to demystify artificial intelligence enablement by providing the structure needed to pursue initiatives for AI use in insurance with confidence and clarity.
A Structured Approach to Realizing AI Value
The Framework is built on an eight-phase methodology:
Phase 0: Strategy Alignment In this initial phase, we establish clear objectives and strategic fit to ensure AI initiatives contribute meaningfully to your mission and vision.
Phase 1: Process Inventory A process inventory identifies and categorizes core, supporting, and management processes to determine where AI-driven process improvements can deliver the most value.
Phase 2: Workflow Modeling Models that detail process endpoints, activity sequences, and decision points provide a visual guide that helps us to zero in on high-impact AI use cases.
Phase 3: Solution Design By documenting functional and technical requirements, we can assess organizational readiness by identifying gaps between current and envisioned process outcomes. Simulation analyses that compare current and future state workflows help validate that the designed solutions are practical and scalable.
Phase 4: Risk & Governance Conducting a thorough examination of ethical, regulatory compliance, and AI governance considerations is a critical feature of our framework that helps to proactively manage risks surrounding the use of AI in insurance.
Phase 5: Implementation The implementation phase involves detailed planning, resource allocation, vendor coordination, and risk mitigation to support the successful execution of AI solutions and improve the likelihood of beneficial outcomes from those solutions.
Phase 6: Deployment & Change Management A too-often overlooked aspect of transformation efforts, solution deployments must involve communication, stakeholder engagement, training, and support functions to promote widespread adoption of the AI-based solutions.
Phase: 7 Monitoring & Continuous Learning Continuous monitoring of performance measures (including cost, productivity, morale, and ROI resulting from AI-enabled improvements) combined with user feedback, ensures that AI solutions are frequently reevaluated to meet your organization’s changing needs.
A Practical Approach Backed by Actuarial Consulting Experts
The Framework is not a theoretical model–it offers a practical, actionable approach to AI adoption that extends familiar business process management techniques with artificial intelligence to improve an insurer’s operations across multiple dimensions: internally among employees, and externally to benefit customers. By following this structured methodology for applying AI in insurance, companies will:
Ensure efforts are focused on high-impact opportunities that align with business goals
Avoid costly missteps and re-work by starting with a holistic picture and addressing risks early
Ensure AI initiatives are ethical, compliant, and well-governed
Build internal support and capabilities for widespread adoption that “sticks”
Whether you’re simply contemplating the benefits of AI in insurance or seeking to scale early successes, Perr&Knight’s AI Adoption Framework offers a roadmap that’s familiar, easy to implement, and highly effective at supporting beneficial outcomes because it is backed by an experienced team of actuarial consulting and business process experts.
Explore the Full Guide
For insurance leaders seeking to navigate the often-confusing AI landscape with clarity and confidence, this guide is an essential resource.
Download the eBook to learn how Perr&Knight can help your organization turn AI potential into measurable business results.
The shift from fee-for-service (“FFS”) models to value-based care (“VBC”) represents a transformative trend in healthcare delivery. VBC contracting aims to improve patient outcomes while controlling costs by linking payments to performance and quality metrics. However, as the popularity of this paradigm grows, providers must carefully navigate the complexities involved to ensure financial sustainability and operational success.
Based on our experience as a trusted actuarial consulting firm assisting provider organizations in structuring these agreements, below are six critical considerations:
1. Shared Savings versus Shared Risk Contracts
VBC contracting typically falls into two categories: shared savings and shared risk. Shared savings models reward providers for reducing healthcare costs while maintaining or improving quality. Conversely, shared risk contracts require providers to share financial losses if costs exceed agreed-upon benchmarks.
Before committing to either arrangement, providers should assess their organization’s financial resilience, care management capabilities, and readiness to assume risk. Shared savings models may be a good starting point for a provider group’s first contract, while shared risk contracts suit more experienced providers with robust infrastructures and data capabilities.
2. Re-Setting Target Medical Loss Ratios for Future Years
Medical Loss Ratios (“MLRs”) are critical benchmarks that represent the proportion of premium revenue spent on medical claims and healthcare quality improvement. Providers need to monitor the performance of MLRs closely and anticipate adjustments for future contract years.
Re-setting target MLRs requires careful analysis of historical performance, anticipated cost trends, and changes in patient population health. Partnering with experts at an established actuarial consulting firm can help providers set realistic targets and ensure financial sustainability under evolving contract terms.
3. Quality Measures
VBC contracts often include incentives such as quality measures. The most common measures are the Healthcare Effectiveness Data and Information Set (“HEDIS”), used to assess care quality. Providers should prioritize initiatives that improve scores in key HEDIS domains, such as preventive care, chronic disease management, and patient satisfaction.
By aligning care delivery processes with HEDIS requirements, providers can enhance outcomes, secure performance-based incentives, and strengthen payer relationships. Leveraging technology and analytics tools can streamline the tracking and reporting of HEDIS measures.
4. Managing Significant Healthcare Costs
A small percentage of patients often account for a significant portion of healthcare costs. Effective management of this patient base is essential to the success of any provider organization. Strategies include proactive care coordination, utilization management, and patient engagement programs. The inclusion of stop-loss insurance, particularly for shared risk arrangements, is also common.
Actuarial analysts can help providers identify patients with the potential for significant healthcare costs early, enabling them to implement personalized care plans and focus on reducing avoidable hospitalizations. Providers can also partner with a seasoned actuarial consulting firm to consider stop-loss insurance options as a way to mitigate risk.
5. Alignment of Goals Across Stakeholders
Contracts often require collaboration between multiple stakeholders, including payers, providers, community organizations, and government agencies. Misaligned goals can lead to inefficiencies and undermine contract success.
It is essential to establish clear objectives around quality metrics, cost savings, and patient satisfaction early in the negotiation process. Defining shared goals ensures that all parties work cohesively toward achieving value-based outcomes.
6. Data Integration and Analytics
At the core of any VBC arrangement is a robust infrastructure to monitor performance, track outcomes, and identify cost-saving opportunities. Providers must be able to effectively track and analyze the claims data for the affected population, perform incurred but not reported (“IBNR”) calculations, develop utilization analyses, calculate the medical loss ratio, and develop financial performance calculations. Providers may also consider partnering with third-party firms specializing in predictive analytics to drive informed decision-making.
Partnering for Success in Value-Based Care
VBC contracting presents an exciting opportunity for providers to drive better outcomes for patients and the healthcare system as a whole. By focusing on shared savings versus risk, re-setting MLRs, prioritizing quality measures, managing high-cost claimants, fostering alignment across stakeholders, and effectively tracking performance, providers can thrive in this evolving landscape.
Working with an experienced consulting partner can mitigate the challenges. Perr&Knight’s team of experienced actuaries provides expert guidance in risk assessment, contract structuring, and performance optimization to help providers achieve their goals on the journey toward value-based success.
As U.S. policymakers ramp up tariffs on imported vehicles, auto parts, and construction materials in 2025, insurers are increasingly feeling the downstream impact on claims costs and profitability. While the consumer-facing effects are gradually unfolding, insurers are already moving behind the scenes — adjusting rate filings, underwriting practices, and reserves to manage the ripple effects of these trade measures.
In this post, the experts at our actuarial consulting firm provide a snapshot of carrier responses and market implications.
The Economic Backdrop
The 2025 tariffs — covering vehicles, auto components, and certain building materials — are expected to amplify inflationary pressures in property and auto repair costs. According to an analysis by the Swiss Re Institute[1] prepared prior to tariff changes announced in early May 2025, the direct cost to U.S. personal auto insurers could reach $31–$61 billion annually. Prior announced tariffs shifted the rate filing landscape: Filings for lower auto insurance rates dropped from 482 in March to just 95 in April 2025 as carriers halted or reversed reductions. Carriers are also preparing for multi-year pricing adjustments as the full impact unfolds. In short, carriers are bracing for change.
Impacts Across All Lines of Business
The actuarial consulting experts at our firm are keeping close watch on the language in filings to assess how carriers are responding to these landscape changes. Here are some of the noteworthy items we have seen in recent rate filings.
“Tariffs and other retaliatory actions will likely result in higher loss costs, which could result in a reduction in profitability and higher than currently anticipated rate increases throughout 2025 and 2026.”
Allstate (Q1 2025 The Allstate Corporation Earnings Conference Call)[3]
“So, we’re going to manage through whatever the impacts of tariffs are, just as we did the inflation that came through the pandemic…And if we need to raise prices, we’ll raise prices…”
Accuity Insurance Company (rate filings, Oregon & Virginia)[4]
+5.5% one-time prospective loss change on property damage coverage
+11.3% one-time prospective loss change on comprehensive & collision coverages
These adjustments reflect forward-looking pricing, not just historical loss trends — a key shift in how actuaries and product managers are modeling risk.
Property / Homeowners Insurance
While less explicitly tied to tariffs, homeowners insurers are reacting to related cost pressures by reassessing replacement cost models, tightening underwriting guidelines (especially in catastrophe-exposed regions), and increasing deductibles or capping coverage on high-value items.
Market Implications
For insurance professionals, the tariff environment raises critical questions:
How can pricing and reserving models capture prospective, rather than trailing, loss costs?
Are underwriting strategies sufficiently agile in the face of shifting repair and rebuild expenses?
How will state regulators respond to tariff-justified rate filings?
How an Actuarial Consulting Firm Like Perr&Knight Can Help
Advanced Actuarial Modeling: We project the impact of tariffs on expected future losses and expenses, considering externally available data and broader economic trends.
Innovative Product Design: We collaborate with your team to design and refine insurance products that address the evolving needs of your customers in this dynamic environment.
Strategic Pricing Solutions: We help you develop data-driven pricing strategies that balance the need for rate adequacy with market competitiveness.
Robust Reserving Methodologies: Our actuarial experts can assist you in establishing sound reserving practices that account for the uncertainties introduced by tariffs.
Regulatory Compliance Support: We provide comprehensive actuarial analysis and documentation to support your rate filings and ensure effective communication with regulatory authorities.
Partner with an Experienced Actuarial Consulting Firm
Don’t let the complexities of tariffs and their impact on the insurance industry leave you behind. Our team of experienced actuarial and product design consultants is ready to partner with insurance organizations of all sizes to develop proactive strategies for pricing and product development.
Collaborating with experienced actuaries and insurance product design experts can help you stay ahead of a shifting landscape and ensure your organization’s continued success in this evolving market.
Contact Perr&Knight today for a consultation and discover how our expertise can help you turn tariff-related challenges into strategic advantages.
[1] Car Insurance Rates Were Ready to Drop. Then Tariffs Came Along. – WSJ
[2] Progressive Corporation Quarterly Report for Quarter Ending March 31, 2025 (Form 10-Q)
Securing a capacity partner is one of the most critical steps in launching or expanding an insurance program. Whether you’re a managing general agent (“MGA”), insurtech, or startup, Capacity Partners (“Partners”) need to see a well-researched, financially sound, and scalable operation before committing their support. Partners are not just looking for premium volume, they want strong underwriting discipline, effective risk management, a clear path to profitability, and efficient operational systems.
In this guide, we’ll walk through the best practices to position your program for success, from market research and actuarial feasibility to distribution strategies and technology infrastructure. By applying these best practices from our actuarial consulting experts you can build a compelling case that attracts the right Partner and foster long-term stability of your program(s).
Market Research & Competitive Analysis
Before approaching a Partner, it is crucial to conduct thorough market research and competitive analysis. Understanding industry trends, target market demands, and the competitive landscape allows you to position your program strategically. Partners want to see that you have identified a profitable niche or can differentiate your offering from existing solutions. Detailed competitor benchmarking, regulatory insights, and market demand assessments will help demonstrate that your program is viable and well researched.
Pitch Deck
A compelling pitch deck is your first impression with potential Partners, so it needs to be clear, data-driven, and persuasive. It should present your program’s value proposition, target market, competitive advantage, and financial projections. Strong visuals, concise messaging, and an emphasis on risk management and profitability will help capture the Partner’s attention. Tailoring your presentation to address the specific concerns and priorities of Partners will increase your chances of securing support.
Actuarial Feasibility Study / Loss Ratio & Profitability Expectations
Partners are typically risk-conscious and will be looking for a well thought out actuarial feasibility study performed by an experienced actuarial consulting team. This analysis should include the projected loss ratio (or the “loss pick”), expected profitability, along with supporting exhibits detailing the analysis. Actuarial soundness is critical—Partners want to see that your pricing strategy aligns with claims expectations and that you have accounted for potential underwriting volatility. Providing robust actuarial support, including historical data analysis, can strengthen your case.
Rating Plan Design
Your rating manual should be carefully designed to balance competitiveness with profitability. Partners will expect a rating manual that reflects sound actuarial principles. Ensuring transparency as well as maximizing price flexibility in your design will make your program more attractive to Partners and enhance profitability potential.
Underwriting Guidelines
Comprehensive underwriting guidelines demonstrate discipline in risk selection and portfolio management, which are critical for securing capacity. Partners want assurance that risks will be evaluated consistently and that underwriting decisions align with profitability targets. Clear guidelines should define risk appetite, eligibility criteria, pricing adjustments, and approval authority. Strengthening your underwriting framework with technology and data-driven decision-making can further enhance Partner confidence.
Risk Management
Partners expect more than just strong underwriting—they expect a holistic approach to managing risk throughout the program’s lifecycle. A well-developed risk management framework signals that you’re proactively identifying, assessing, and mitigating exposures. This includes setting clear risk tolerances, establishing protocols for emerging risk detection (e.g., Loss Control programs), and building feedback loops between claims, underwriting, and actuarial teams. Partners will also look for evidence of strong governance practices, including internal audits, compliance, quality control, and ongoing portfolio monitoring. Integrating risk management into your operational and strategic decisions helps ensure long-term profitability and signals to Partners that your program is built for resilience, not just rapid growth.
Proforma Financials
A detailed financial projection gives Partners confidence in your program’s sustainability and scalability. Proforma financials should outline expected premium volume, claims development, expense ratios, and return on investment generally over a three-to-five-year period. Clearly defining minimum premium thresholds and demonstrating a realistic path to profitability will help you gain Partner buy-in. Additionally, a well-thought-out scalability plan—accounting for expansion strategies and capital requirements—will show Partners that your program has long-term potential.
Distribution / Growth
Partners will assess your distribution strategy to ensure you have a reliable path to premium growth. Whether through retail agents, MGAs, direct-to-consumer channels, or partnerships, a well-defined distribution plan is key. Partners want to see that you have a robust network, a proven sales strategy, and an understanding of customer acquisition costs. Ensuring your growth projections are realistic and supported by market data will help build Partner confidence in your program.
Systems (Policy Administration, Claims Processing, Data Analytics)
A strong technology infrastructure is essential for efficiency, compliance, and profitability. Partners prefer programs with modern policy administration, claims processing, and data analytics capabilities. Automation and data-driven insights can improve underwriting accuracy, reduce fraud, and enhance customer experience. Demonstrating that your systems are scalable, integrated, and aligned with industry best practices will strengthen your appeal to Partners.
