Data-Driven Decision-Making: All the Cool Kids Are Doing It

By: Nick Sarneso March 14, 2019

There’s a bit of a change taking place in company circles. After many years of being at the end of a variety of “nerd” jokes, actuaries are gaining some popularity for what we have to offer. The large claims trend is creating a number of challenges in the business, and our knowledge is vital to efforts that can help to minimize the impact. This, dare I say, has caught the attention of those in all segments of the company because actuaries have what everyone needs to make smart decisions in challenging times – the ability to turn data into action.

In all seriousness, data-driven assessments have become essential to real-time tactical decisions and long-term planning. Advancements in technology are providing more opportunities to glean what is most useful to key decision-makers so they can be more nimble in their actions. Data also lends support in explaining why tough decisions are being made or why it might be okay to be a little more lenient with the options in a different scenario. And, at a time when large claims incidences and costs are on the rise, actuaries are taking a leading role in extracting insights that lead to solutions.

Data insights enable us to more accurately price the business; gain a clearer perspective on claim cost drivers; and dive deeper to slice and segment information for Underwriting, Sales, Claims and other management groups to use within their business roles and processes. These insights also provide support for conversations.

As a Stop Loss company, HM Insurance Group works to provide financial protection to self-funded groups. In order to do so successfully, we have to determine the right premium for the risk. If we are being contracted to pay catastrophic claims, we need to have the funds available to meet our obligations.

Our role as actuaries is to enhance risk selection by providing statistics on network discounts, area dynamics, cost data experience and other factors necessary for a well-rounded evaluation. This information is imperative to making informed underwriting decisions and also gives HM the opportunity to be more consultative with our producers, partners and clients.

There is so much value in taking a complicated data set and making it simple for non-math people. As we focus further, we can simplify better and provide a meaningful message to key decision-makers – both internal and external – and serve as a valuable resource in this challenging market. We want those working with HM to know how thoughtfully we consider the plans we put into place, keeping each customer’s best interest in mind.

As an actuary, I’m very familiar with stats, facts and the lines of a spreadsheet, but as someone who’s part of company that’s working to guard the financial health of our policyholders, I know that spreadsheets only tell a part of the story. Being able to take the numbers – and the dynamics behind those numbers – and turn them into the right protection at the right price is the goal for all involved. It actually feels pretty “cool” to be working for a company that values using smart practices backed by data to craft the right Stop Loss coverage for our self-funded clients.

Nick Sarneso

Nick Sarneso serves as director, Actuarial Services, for HM Insurance Group (HM) and is responsible for the pricing and valuation of HM’s products. He manages a team of actuarial employees and is a trusted advisor to HM’s senior leaders.  With nearly 15 years of experience in the insurance industry, his areas of expertise include stop loss rating, reserving, product design and network evaluations. Nick joined HM in 2007 and held roles of increasing responsibility before accepting the director position. Prior to joining HM, Nick worked as an actuarial analyst at Old Republic Insurance Company. Nick holds a Bachelor of Science degree in Mathematics from St. Vincent College. He is a Fellow of the Society of Actuaries (FSA) and a member of the American Academy of Actuaries.
Filter by Topic