Selecting the Method of Calculating the Ground-up Losses

When configuring a non-catastrophe peril analysis you can choose either of the following methods of calculating the ground-up losses:

•       Use the ISO loss cost calculator

•       Use a custom calculator

Use the ISO Loss Cost Calculator

When you use the ISO loss cost calculator, you can also specify which peril group(s) you want Touchstone to use for commercial property locations during an analysis. You can apply ISO Basic Group 1 commercial property loss costs, an adjusted homeowner's loss cost without tropical storm effects, or both of these options. You can use the ISO loss cost calculator both in lieu of a company's own loss data and as a benchmark against which to compare a company's own loss data. Further, administrators can specify custom loss cost templates that calculate a loss cost for any location that does not have an associated ISO loss cost.

Use a Custom Calculator

Administrative users can create a custom loss cost calculator for the loss analysis engine to use instead of using the calculations that ISO's loss cost calculator provides. The loss analysis engine applies the rule if it matches the criteria for the location. You can also apply your own adjustments to the base loss costs. This option is useful for companies that have created their own loss cost database. If you choose to use a custom calculator, you can select an existing calculator, or, if you have administrative privileges, you can click and create your own calculator. When you apply custom loss costs to an exposure view, any risk (location) that is not covered by a rule does not generate an expected loss. Creating a country wide base cost loss ensures that all risks generate an expected loss.