Inadequate or outdated pricing models

Pricing models rely on generalized linear modeling and limited data, producing inaccurate rates in specialty lines and edge cases.

Analysis:

AI/ML-based pricing models that incorporate alternative data sources, real-time signals, and more sophisticated algorithms could dramatically improve pricing accuracy. Carriers that price risk more accurately win — they avoid adverse selection and capture profitable segments. This is a foundational capability that touches hundreds of billions in premium.