MetLife has good reason to be proud of its property and casualty division, MetLife Auto & Home. It has consistently outperformed the rest of the industry in underwriting its risks, but the acquisition of the St. Paul Companies in 1999 made that industry position a little more tenuous.
Bonnie McHenry, director of corporate underwriting for the property team at MetLife, said that after the acquisition it was evident that the property side needed to do more underwriting with the policies it had acquired. Approximately 70 percent of the book was underinsured, some of it by as much as 30 percent, McHenry said. Thats significant when you have several hundred thousand policies.
McHenry said lower values on property risk is a common problem in the industry. Homeowners often remodel their houses or add a new deck or a garage without notifying their insurance agent or the carrier of the change. MetLife knew it had to get better valuations of the property it was insuring, but the company did not have the personnel or the expertise to initiate such a project. We could have done it ourselves with the proper manpower and a dedicated service center, but thats hard for a company like ours, McHenry said. It was better to outsource it.
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