GRET Factors for 2009 Compared to Historical Fact
2008-Nov-01 - Christopher H. Hause
The GRET factors for 2009 were released to the NAIC in May, the factors were posted on the NAIC web site for comments, and they have now been adopted.
This is the second time the factors have been released with an expanded list of company types. However, as pointed out in comments sent by the New York Insurance Department, there is concern that over 50% of the companies included are in the "Other" category. New York also points out that average premium per policy for the "Other" category increased from $19 to $62 from 2008 to 2009.
The following comparison of the historical factors, although showing stability in factors for some company types, continues to show questionable variability in the factors for some.
History of Factors - Acquisition
| Expense Factor | Year | Branch Office | Direct Marketing | Home Service | Career General Agency | Brokerage | PPGA | Multiline | Other |
| Per Policy | 1998 | $65 | $91 | $53 | $73 | ||||
| 2001 | $70 | $87 | $60 | $78 | |||||
| 2003 | $66 | $80 | $61 | $85 | |||||
| 2006 | $76 | $111 | $72 | $78 | |||||
| 2007 | $62 | $130 | $64 | $79 | |||||
| 2008 | $54 | $112 | $75 | $108 | $83 | $79 | $111 | $71 | |
| 2009 | $59 | $110 | $66 | $105 | $98 | $100 | $113 | $72 | |
| Per Unit | 1998 | $1.15 | $1.60 | $0.95 | $1.30 | ||||
| 2001 | $1.25 | $1.55 | $1.05 | $1.40 | |||||
| 2003 | $1.15 | $1.40 | $1.10 | $1.50 | |||||
| 2006 | $1.35 | $2.00 | $1.30 | $1.40 | |||||
| 2007 | $1.10 | $2.30 | $1.15 | $1.40 | |||||
| 2008 | $1.00 | $2.00 | $1.30 | $1.90 | $1.50 | $1.40 | $2.00 | $1.30 | |
| 2009 | $1.10 | $2.00 | $1.20 | $1.90 | $1.70 | $1.80 | $2.00 | $1.30 | |
| % age Premium | 1998 | 72% | 50% | 29% | 40% | ||||
| 2001 | 78% | 48% | 33% | 43% | |||||
| 2003 | 73% | 44% | 34% | 47% | |||||
| 2006 | 84% | 61% | 40% | 43% | |||||
| 2007 | 69% | 72% | 35% | 44% | |||||
| 2008 | 60% | 62% | 41% | 60% | 46% | 44% | 61% | 39% | |
| 2009 | 66% | 61% | 36% | 58% | 54% | 55% | 62% | 40% |
History of Factors - Maintenance
| Expense Factor | Year | Branch Office | Direct Marketing | Home Service | Career General Agency | Brokerage | PPGA | Multiline | Other |
| Per Policy | 1998 | $33 | $46 | $27 | $37 | ||||
| 2001 | $35 | $43 | $30 | $39 | |||||
| 2003 | $33 | $40 | $31 | $43 | |||||
| 2006 | $38 | $56 | $36 | $39 | |||||
| 2007 | $31 | $65 | $32 | $40 | |||||
| 2008 | $27 | $56 | $37 | $54 | $42 | $40 | $56 | $36 | |
| 2009 | $30 | $55 | $33 | $53 | $49 | $50 | $56 | $36 |