Archive | Actuary

Will CFPB Regulations Trickle Down to Providers & Administrators?

Will CFPB Regulations Trickle Down to Providers & Administrators?

Alright, as an owner or executive of a company, waking up in a cold sweat at 2am happens more often than you would like. There are many different reasons for this (e.g. stress over money, kids, a big business relationship, heartburn from eating a meatball sub too late at night, etc.), but regardless of the … Read More »

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Earnings Curves: Matching Premium with Losses…and Refunds?

Earnings Curves: Matching Premium with Losses…and Refunds?

With vehicle service contracts (VSCs) extending coverage over multiple years and premiums collected at the beginning of the contract, it is extremely important to have a benchmark to assess the profitability of the contracts that have been issued. Recognizing profitability (or lack thereof) early in the life of the contracts will assist a company in … Read More »

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Earnings Curves: The Past, Present and Future

Earnings Curves: The Past, Present and Future

The Earnings Curve For vehicle service contracts (VSCs), the earnings curve is a critical tool for financial reporting and experience evaluation. Typically, the earnings curve is a set of factors by month, which show how much of a contract should be earned. When a company evaluates its financial results at the end of the year, … Read More »

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GAP: A 2013 Update

GAP: A 2013 Update

When we last checked in on GAP, there were significant improvements in costs. Used car prices clearly bottomed in late 2008. There has been quite a recovery since then. However, it appears that pricing may have peaked in 2011, with some softening since then. Based on the Manheim Index, the used car market is about … Read More »

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Big Data – What is it?

Big Data – What is it?

Big data is the new buzzword. Business publications are full of stories about big data. A Google search will yield a lot of information about big data — and a lot of vendors trying to sell you on Big Data. But what is Big Data? It depends on whom you ask. But a general rule … Read More »

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The Metrics We Use

The Metrics We Use

With this article, we’ll go back to basics and talk about the various metrics and measures to evaluate a service contract book. All measures have value but many must be interpreted in the context of a service contract book. Policy Year vs. Calendar Year Data is typically organized by policy year, or the year that … Read More »

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