At the conference last week of the Specialized Carriers & Rigging Association I got a bit of a look inside a system that’s been in existence for years but that, according to some, insurance underwriters are increasingly turning to in efforts to predict future risk for carriers, part of the dramatic rise in premiums we’ve seen of late. A big part of that system, referred to as CAB by many in the business (that stands for “Central Analysis Bureau”), however, is nothing new.
It gives anyone subscribing to it access to those persnickety CSA scores that Congress so long ago now ordered pulled from public view in part in an effort to mitigate such use, given real concerns over the accuracy of any predictive use of such big data. “Earlier today we had the [FMCSA] administrator up here talking — a great presentation,” said Bill Hebron, program manager with specialty insurer NBIS, making reference to current acting FMCSA chief Jim Mullen’s speech earlier that day at the symposium, where Mullen talked about “the law of unintended consequences,” Hebron went on. “He said CSA scores were not designed for litigation, or for insurance. He said that, but guess what? They’re there, so everybody sees your CSA scores — they know where you are.”
That’s because the data underpinning those old public scores remains available to third parties, and with that data, and long-public scoring methodology, private entities like the Central Analysis Bureau can easily re-create the system in order to “predict the future,” or at least that’s how another insurance agent recently described it to me. That agent likened some underwriters’ near-total reliance on predictive algorithms to the dark situation in “Minority Report,” the dystopian film and Philip K. Dick sci-fi short story in which criminals are arrested before committing their crimes, based on supposed foreknowledge.
I’ll get back into that in more depth in future reporting, because today I’m happy to say that, at least for some insurers, the human element remains a central part of underwriting. Consider the case of Richard and Lisa Weddle and their for now one-truck Kool Ride, LLC owner-operator business.
Late in the afternoon of January 16, as freezing rain had begun over I-40 in New Mexico, near milemarker 222, the Weddles came up over a rise in time to see a minivan up ahead lose control and flip over onto its side in the median.
“We saw the van wreck right in front of us,” Lisa says, and later realized there was another vehicle that had lost control while pulling a small U-Haul trailer a little farther down the median. “We stopped on the shoulder to help the people in the van. It was a husband and wife, with three kids. Thankfully, nobody was hurt in that wreck.”
Rick exited the truck to assist, and Lisa got on the CB trying to warn those coming into the area. “We had gotten well off the road on the shoulder,” Lisa says — flashers, triangles, the whole bit, and Lisa dialed 911 whereupon she realized emergency personnel were already en route given the other wrecked vehicle pulling the U-Haul.
