Toronto Area SAS Society December 8, 2006 How One Can Use SAS to Easily Manage an Otherwise Unmanageable Task Dr. Arthur S. Tabachneck Insurance Bureau of Canada Statistical Research and Development Department

Toronto Area SAS Society December 8, 2006 IBC’s Department of Statistical Research and Development Manage databases which include all government and non- government auto insurers’ premium and claims information Build and maintain a database of Vehicle Information Numbers (VINs) and the vehicle characteristics they represent Assist other IBC divisions with all needed analytical services Conduct research to identify emerging trends Develop and apply statistical models to estimate anticipated claims and related costs Provide advisory make/model/model year-specific Collision, Comprehensive, Property Damage and Accident Benefit ratings for all Canadian insurers

Toronto Area SAS Society December 8, 2006 Insurance 101 IBC ICBC SGI Data Including: Vehicle Information Number (VIN) premium/vehicle/coverage # of claims/vehicle/coverage cost of claims/vehicle/coverage MPI GAA SAAQ

Toronto Area SAS Society December 8, mil vehicles mil vehicles 0.53 mil vehicles 0.45 mil vehicles 4.2 mil vehicles 6.8 mil vehicles 0.62 mil vehicles 0.66 mil vehicles 2.2 mil vehicles mil vehicles How much data is involved? mil vehicles mil vehicles

Toronto Area SAS Society December 8, 2006 How much data is involved? # of Records = 18,123,885 × 10 = 181,238,850 # of Records = 181,238,850 × 12 = 2,174,866,200 # of Records = 40 × 2,174,866,200 = 86,994,648,000

Toronto Area SAS Society December 8, 2006 Loss Cost = Total Claim Costs × # of Claims Total Claim Costs = # of Vehicles Likelihood of a claim Average claim cost # of Claims # of Vehicles Insurance 101

Toronto Area SAS Society December 8, 2006 One’s Driving Record One’s Age Where One Lives Cost of Insurance The Vehicle How Much One Drives Total Premium CLEAR Rating Insurance 101

Toronto Area SAS Society December 8, 2006 Collision coverage: the costs involved when one is “at fault” in an accident Can’t just look at how much a vehicle costs Toyota Corolla MSRP $16,404 Relative Loss Cost = 115 The Problem Mitsubishi Lancer MSRP $15,555 Relative Loss Cost = 650

Toronto Area SAS Society December 8, 2006 Chevrolet Avalanche 1500 MSRP $35,938 Mercedes-Benz C230 MSRP $36,386 Relative Theft Frequency = 74 The Problem Theft Frequency (the likelihood of a vehicle being stolen) Can’t just look at how much a vehicle costs Relative Theft Frequency = 238

Toronto Area SAS Society December 8, 2006 The added cost of features which reduce insurance claim costs should not result in higher premiums Traction Control ABS Seat Belt Pretensioners Theft Deterrent Systems Restraint Systems Stability Control The Problem

Toronto Area SAS Society December 8, 2006 Insurance rates must be available before insurance experience is known The Problem

Toronto Area SAS Society December 8, 2006 Body style Drivetrain Wheelbase Weight Engine displacement Engine horsepower MSRP Indexed MSRP Type of brakes Theft deterrent system Track width Height Types of airbags Manufacturer Seating capacity Brake assistance Ground clearance Traction control Stability control Types of headrestraints Seatbelt pretensioners Lane departure warning Tracking system Parts marking Engine type Engine placement Age General model and model Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 CLEAR - How it works

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR)

Toronto Area SAS Society December 8, 2006 Canadian Loss Experience Automobile Rating (CLEAR) How?

Toronto Area SAS Society December 8, 2006 How?: Design appropriate directories and filename structures ARQC3001.sas7bdat Type of Run Measure Province Coverage Version

Toronto Area SAS Society December 8, 2006 How?: Build SAS macros to accomplish each task

Toronto Area SAS Society December 8, 2006 How?: Use SAS AF to let users indicate requirements

Toronto Area SAS Society December 8, 2006 How?: Use SAS AF to let users indicate requirements

Toronto Area SAS Society December 8, 2006 How?: Incorporate SCL to run each macro

Toronto Area SAS Society December 8, 2006 How? Understand the problem Planning Design SAS Macros SAS AF SAS Component Language

Toronto Area SAS Society December 8, 2006 Questions?