Markel Corp. (NYSE:MKL) Q3 2016 Earnings Conference Call - Final Transcript
Nov 02, 2016 • 09:30 am ET
to me here. I mean, having followed for a long time, it doesn't normally take you guys two or three bites at the apple in order to get on top of these is what's been different about this that has made it so difficult to kind of get in front of the trends.
Yeah, sure, Mark. I think part of the issue has been our actuaries, you have your triangles and you can often see in the triangles, things starting to change. As I sort of alluded to with the first question, this was a very abrupt change. There wasn't a great deal of warning, all of a sudden, the development factors, the frequency, the severity just ticked up.
And that's, I guess, in some ways, it's been the experience in medical it tends to move quickly when it moves. So we weren't able to sort of see that in our triangles. And one of the questions we've asked ourselves is, what other tools do we need to make sure we have at our disposal, such that we're not just relying it not that we just rely on the triangles, but what can we glean from the claims data? What can we see in terms of the mix of business, make sure we're using all the tools at our disposal because, believe me, we never put a number out in the quarter that we we think it's wrong, we always try to put out the best number we possibly can.
And quite honestly, for it's taken us three quarters to get here in terms of putting getting the numbers where we hopefully believer are correct. And and that's not the way we like to do things.
Okay. One further question on that, if I may, the you suggested in the comments that you've taken some underwriting actions, particularly with respect to a couple particular lines you highlight, is that a matter of just raising prices or not writing those lines, or maybe just a little more detail about how you've adapted to try to seal off the issue?
It's really both. There's been some problematic parts of the business that we've identified where we've raised prices significantly. And in some cases, in one of those areas, we've written one account since we've put those actions in place. So, while we're still in that business, it would have to meet our pricing target. It's a bit of both. It's tightening up the underwriting standards around parts of the book. It's increasing pricing and it's deemphasizing and remixing the book. So, it's a little bit of everything and as I said, the entire team is involved in it. We've got the product line leaders, the actuaries, our information management people, as well as our claims folks all working together to make sure we're putting the best plan in place that we can.
Okay. That's enough on that then. Let me jump over to Tom. I saw that you had, I guess, the