Known Issue 442

Ground-up losses can vary for combined peril exposures when Loss Modification Factor (LMF) rules have different factors across overlapping regions or peril combinations.

Issue ID 442
Summary Ground-up losses can vary for combined peril exposures when Loss Modification Factor (LMF) rules have different factors across overlapping regions or peril combinations.
Description When LMF rule parameters are applied to geographic regions with overlapping administrative boundaries in the template (such as a county within a state), it can result in incorrect calculation of modified ground-up losses.
Resolved in Touchstone 2025 (13.0)
Date posted 4/16/2025
Software versions affected 12.0, 11.5, 11.0
Feature set Detailed loss
Models Varies
Potential for loss numbers impact Yes
Workaround The user should ensure that admin boundaries do not overlap. Instead of applying an LMF rule at the state level, it is better to list all counties within that state individually, assigning the same LMF factor for a specific peril where applicable.

There are two approaches to handle variations:

  1. If different counties require different LMF factors for different perils, assign those factors at the county level accordingly.
  2. If the same counties are affected by multiple perils, run the analysis separately for each peril rather than combining them.
Verisk bug 804307