[QUOTE=Snoopy;772077
Turners have another way to generate 'insurance capital' and that is to raise premium charges by more than the expected payouts they will make. In 'insurance speak', I think the term for this is 'reducing the loss ratio'. So we shareholders could just take the 'insurance capital surplus' knowing that if the balance turns negative again we can just increase insurance premiums. I have to admit feeling a bit queasy over the ethics of that behaviour. The counter argument would be that if the net plan deficit were to remain we shareholders would be obliged to make up the difference. So it is only fair that we should take away our surplus capital when it is ostensibly no longer needed.[/QUOTE]
"Insurance speak"."Reducing the loss ratio".
a] By carefully knowing the different repair costs for various vehicles Autosure can better match premiums.I have previously posted that fixing European vehicles cost 3 to 6 times as much as Japanese vehicles.Four wheel drive are also a lot more expensive to fix than two wheel drive...[data].
b] By assessing whose liability the repairs are.A lot of times the vehicle may have been sold with an existing problem.So it is the dealer's responsibility to repair, rather than Autosure's.
c] Making sure the vehicle has been serviced as per the Autosure policy.