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General Insurance pricing practices where more advanced analytic techniques and non-risk based customer data is leveraged has been widely criticised resulting in an increased focused on regulating from a pricing and fairness perspective.

Over time the pricing of retail General Insurance products has become ever more sophisticated, leveraging the availability of new or expanding data sets and analytical capabilities. The underlying cost of insurance – the expected cost of claim and cost of service – has become somewhat disconnected from the ultimate price charged to customers. Many firms use “price optimisation” techniques and extensive data enrichment to incorporate behavioural characteristics of customers into prices, such as propensity to renew, in addition to reflecting variation in risk.

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