Member Spotlight: Kroll
The challenge with property valuations
Insurers use property valuations to help price new business and to update premiums of existing customers at the point of renewal. Inaccurate data can lead to mispriced business with significant downstream effects that, when taken in aggregate, can impact an insurer’s financial performance.
Inaccurate property valuations also have an impact on the policyholder. If a building is underinsured, a claims pay-out will often be less than the cost of rebuilding the property, leaving customers with a pay-out shortfall.
In 2022, 67% of the buildings valued by Kroll were underinsured by an average of 64%. Underinsurance is a key challenge within the risk management and insurance community – but it is a problem Kroll is aiming to solve.
Property Insurance Valuation Platform
Kroll provides global commercial building valuations through its Property Insurance Valuation Platform. The tool combines proprietary data with Kroll’s valuation algorithm to help users identify underinsurance within their property portfolios.
The algorithm is able to alert clients where further investigation is needed to come up with a valuation. This can be because the building is particularly complex or it exceeds a certain value, meaning it requires an in-person inspection. Kroll uses its team of over 250 valuation experts to provide insights and deeper analysis on the properties in question.
In some cases, this may not even require an in-person investigation. Kroll can use detailed CAD (computer-aided design) maps where available and talk to individuals over the phone. Rebecca pointed out the benefit of reduced emissions as a result of less travel to conduct in-person inspections.
When talking about the other benefits of Kroll’s approach to valuing assets, Rebecca highlighted its consistent and transparent standard.
“Kroll uses a consistent methodology to value assets. We can explain it to anyone and we actively encourage feedback to improve it. We would like to become the new accepted standard for valuations across the insurance industry.”
Partnership with WTW
Earlier this year Kroll partnered with global broker WTW to provide an independent valuation service. Using Kroll’s tools, WTW’s clients can now access property valuations supported by the latest statistical information on markets and costs. This helps clients to ensure they have adequate insurance coverage based on the values of their property portfolios.
Kroll is providing property valuations to a range of other organisations within the insurance industry, including AXA.
Valuation offering
Rebecca mentioned that over 2024, the company is looking to expand its valuation offering.
“One of the most interesting areas we are working on is including plant machinery assets on the valuation platform. Our aim at Kroll is to create a platform for valuing all fixed assets for any purpose.
“I have also recently begun exploring energy efficiency data. Over 2024 we will be looking to incorporate this information into our product offering.”
Network of Women
Alongside Rebecca’s work on valuation issues, she leads the Kroll Network of Women. The aim of the group is to support women and encourage an inclusive working environment, both within Kroll and the company’s external network.
This year the group raised money for Prevent Breast Cancer, a charity which is building new facilities to detect cancer early, allowing for preventative treatment. Rebecca notes: “At Kroll, our focus is around risk mitigation and prevention. Supporting a charity that is working to reduce risk through efficient screening and data was incredibly important to us.”
Learn more about Kroll’s work
To learn more about Kroll’s work within the insurance industry, you can visit its website. Rebecca also encouraged readers to reach out to her directly:
“I’m looking to connect with any insurers that are struggling with property or plant machinery valuations. As we look to expand the capabilities of our offering, I would also love to hear from any companies working within the 3D spatial and natural catastrophe data space.”