The Impact of Law Changes on Ratemaking Data for Private Passenger Automobile Insurance

Various types of data are used in determining statewide rate level indications ("RLI") for private passenger automobile insurance. Some major types of data used in RLI's are the base data, loss development data, trend data, and data used to measure investment income. In this paper, the impacts of several hypothetical law changes on these various types of ratemaking data are analyzed. Beginning with actual Allstate data, the impact of the law change on that data is modeled, allowing the overall impact of the law change on the various types of ratemaking data to be determined. Keywords: Auto Liability, Auto Physical Damage