Average Loss Ratio Research Articles

IOT‐HML: A hybrid machine learning technique for IoT enabled industrial monitoring and control system

SummaryIndustrial 4.0 makes manufacturers more vulnerable to current challenges and makes it easier to adapt to market changes. It is essential to focus on monitoring and controlling the production system before complex accidents occur. To overcome above research gaps, we shift to industrial 4.0, which combine IoT and mechanism learning for industrial monitor and manage. Here, we propose a hybrid machine learning technique for IoT enabled industrial monitoring and control system (IoT‐HML). The main goal of the research is to overcome the issues of information security and control systems by developing a hybrid machine learning technique. Compared to the existing AODV protocol, the proposed C‐IWO based routing protocol outperformed efficiently in terms of 19.2% average delay, 12.7% average energy consumption, 10.26% average throughput, 3.8% average delivery ratio, and 16.33% average loss ratio, respectively. In addition, the accuracy 98.5%, sensitivity 97.3%, specificity 98.2%, precision 98.35%, recall 98.32%, and F‐measure 97.49% of proposed CP‐LNN technique is very high compare to obtainable state‐of‐art classifiers.

Vaccine versus infection - COVID-19-related loss of training time in elite athletes.

ObjectiveTo determine the number of training days lost due to COVID-19 and vaccination against COVID-19 in elite athletes.DesignRetrospective cohort study.MethodsThe questionnaire on the impact of vaccination and COVID-19 on training plans was filled out by 1073 elite Polish athletes who underwent routine medical screening between September and December 2021.ResultsCOVID-19 was diagnosed in 421 subjects (39 %), of whom 26 % were asymptomatic. On the 10-point scale, <1 % of athletes had perceived severity of the disease above 8, whereas for 64 % it was 4 or below. Vaccination against COVID-19 was administered in 820 athletes (76 %), adverse events were observed more frequently after the first dose than after the second (69 % vs. 47 %).Influence on training (modified or lost) was declared by 369 of 421 (88 %) COVID-19 athletes, and by 226 of 820 vaccinated athletes (28 %). During the observation period, the average number of lost training days was 8.1 for COVID-19 and 2.6 for vaccination (p < 0.001). The cumulative number of person-days lost due to COVID-19 was 1041 versus 295 after vaccination thus, the average loss ratio was 1041/1073 = 0.97 vs 295/820 = 0.36, respectively, p < 0.01.ConclusionsAthletes have a considerable loss of training days due to COVID-19. Vaccination against COVID-19 causes significantly smaller and predictable loss. This supports the inclusion of vaccination into prevention policies for athletes whenever they are available.

Exploring Industry-Level Fairness of Auto Insurance Premiums by Statistical Modeling of Automobile Rate and Classification Data

The study of actuarial fairness in auto insurance has been an important issue in the decision making of rate regulation. Risk classification and estimating risk relativities through statistical modeling become essential to help achieve fairness in premium rates. However, because of minor adjustments to risk relativities allowed by regulation rules, the rates charged eventually may not align with the empirical risk relativities calculated from insurance loss data. Therefore, investigating the relationship between the premium rates and loss costs at different risk factor levels becomes important for studying insurance fairness, particularly from rate regulation perspectives. This work applies statistical models to rate and classification data from the automobile statistical plan to investigate the disparities between insurance premiums and loss costs. The focus is on major risk factors used in the rate regulation, as our goal is to address fairness at the industry level. Various statistical models have been constructed to validate the suitableness of the proposed methods that determine a fixed effect. The fixed effect caused by the disparity of loss cost and premium rates is estimated by those statistical models. Using Canadian data, we found that there are no significant excessive premiums charged at the industry level, but the disparity between loss cost and premiums is high for urban drivers at the industry level. This study will help better understand the extent of auto insurance fairness at the industry level across different insured groups characterized by risk factor levels. The proposed fixed-effect models can also reveal the overall average loss ratio, which can tell us the fairness at the industry level when compared to loss ratios by the regulation rules.

A comparative study of the permeability enhancement in coal and clay-rich shale by hydraulic fracturing using nano-CT and SEM image analysis

The low permeability of unconventional reservoirs is a key petrophysical parameter that restricts the seepage and migration of methane in micro-channels. Coal and shale have a high content of clay minerals, and swelling clay minerals lead to permeability reduction due to their unique water sensitivity and swelling mechanism, which is an important factor affecting the production efficiency of methane in reservoirs. This work begins with visual two-dimensional (2D) and three-dimensional (3D) characterization of the pore-fracture network in coal and clay-rich shale and emphasizes the root cause of the different changes in coal and clay-rich shale permeability by hydraulic fracturing. The results showed the increase of pore and throat radius of coal by hydraulic fracturing is significantly higher than that of clay-rich shale, indicating that high vitrinite and low clay content contribute to brittle deformation, while high clay and low vitrinite content account for ductile deformation. Hydraulic fracturing can form more effective micro-channels and increase shale permeability by nearly two orders of magnitude. The permeability enhancement of clay-rich shale is apparently better than that of coal by hydraulic fracturing. After fracturing, the average loss ratio of permeability of clay-rich shales is 35.2%, which is much higher than the average loss ratios measured on coal (11.1%), suggesting that the abundant water provided by hydraulic fracturing leads to the absorption and swelling of clay minerals in shale. Swelling clay minerals cause persistent adsorption and filling of H2O molecules between layers, forming colloidal suspensions in the micro-channels, further blocking the migration pathway of methane molecules in clay-rich shale.

The impacts of VOCs on PM2.5 increasing via their chemical losses estimates: A case study in a typical industrial city of China

Volatile organic compounds (VOCs) have been explicitly required to be controlled by national or local governments to tackle heavy PM2.5 pollution in China. However, the role of VOCs chemistry in PM2.5 is still far away from being fully understood. In this study, we selected a typically industrialized city of China, conducted VOCs online measurements in July and December of 2020, estimated VOCs chemical losses, and explored their impacts on PM2.5 in the real atmosphere. Our measurements totally detected the mixing ratios of 53 VOCs species, sum of which reaching 20.8 ± 9.1 ppb and 45.5 ± 19.8 ppb in July and December respectively. Based on the change in the relative abundance of various VOCs species with different reactivity, daily OH exposure and daily O3 exposure (molecules·s·cm−3) were estimated, respectively with the mean value of 11.0 × 1010 and 5.2 × 1015 in July, 5.9 × 1010 and 3.1 × 1015 in December. Thus, there were about 6.7 ± 3.2 ppb and 11.1 ± 5.0 ppb VOCs chemically lost in July and December, with the average loss ratio of 29.7% and 19.3% in respective. In July, PM2.5 in the range of 20–60 μg m−3 positively responded to VOCs loss ratios, and high PM2.5 values were always accompanied by higher VOCs losses instead of high CO levels; but their relationship became negative in December when PM2.5 in the range of 40–150 μg m−3, and extremely high PM2.5 values happened in high CO conditions instead of high VOCs losses conditions. Moreover, PM2.5 measurements in this city also showed an apparent upward trend in OC/EC with PM2.5 in summer, but a slight downward trend in winter. These all indicated that in the conditions of stronger solar radiations (summer) and low-middle aerosol loads, VOCs chemistry played the important role in PM2.5 increasing through contributing SOA; but in the conditions of lower solar radiations (winter) and heavy aerosol loads, VOCs chemistry was greatly weakened and had the minor impact on PM2.5 increasing. The measure involving VOCs reduction to alleviate PM2.5 pollution in winter needs to be cautiously considered and examined.

Structured reinsurance deals with reference to relative market performance

In this paper we study a specific type of structured reinsurance deals, for which the indemnification scheme is contingent upon the performance of the cedent, for instance measured in terms of his loss ratio compared to the average loss ratio of the market. We show that this type of deals may be efficiently used to manage risk in the presence of financial distress cost when the cover is provided to a cohort of insurers with positively correlated loss experience. In addition to theoretical results we quantitatively illustrate the potential performance improvement in a numerical example.

Role of Alkali Type in Chemical Loss and ASP-Flooding Enhanced Oil Recovery in Sandstone Formations

Summary Chemical combination flooding techniques, particularly alkali/surfactant/polymer (ASP) flooding, have proved to be effective in enhanced oil recovery (EOR). The development of this flooding technique in the Daqing Oil Field (China) shows that it can prevent production declines and help oil companies increase profits. However, ASP chemical loss and the resulting chromatographic separation in sandstone formations remain as limitations in the practice of ASP flooding. Laboratory investigations have analyzed the behavior and characteristics of chemical loss in sandstone reservoirs recently subjected to strong-base [sodium hydroxide (NaOH)] and weak-base [sodium carbonate (Na2CO3)] ASP flooding. A set of experiments were reasonably designed to study how formulation compositions, slug combination patterns, and heterogeneity affected the chromatographic separation and consumption loss characteristics of chemicals in sandstone reservoirs subjected to ASP flooding. Our investigations determined chemical-loss ratios through various experiments, described the underlying mechanism behind the discovered consumption loss characteristics, and discussed the effects of comparative ASP flooding processes. Furthermore, the incremental oil recovery factor and degree of permeability damage in heterogeneous sandstone reservoirs subjected to strong-base and weak-base ASP flooding processes were assessed and compared. Then, the role of alkali type in chemical loss, EOR efficiency, and reservoir flow assurance in sandstone formations were ascertained for the first time. The results indicated that chemical-loss behaviors and chemical chromatographic separation could be alleviated in a weak-base ASP flooding. In particular, in heterogeneous sandstone reservoirs, the average loss ratios of alkalis and surfactants could be reduced by 9.61% and 15.67%, respectively, compared to the strong-base ASP flooding. A profitable EOR of 20% or more could also be obtained with a weak-base ASP flooding. Moreover, a reduction of approximately 15% in the permeability-damage ratio could be realized in weak-base ASP flooding compared with the strong-base system, and the reservoir flow-assurance issues related to chemical loss could be addressed. The optimal designs for ASP formulations and slug combination patterns could technically and sustainably achieve high oil recovery in sandstone reservoirs with a weak-base ASP flooding. The results help illustrate the chemical combination flooding mechanism and can contribute to the existing knowledge regarding the additive effects of chemicals during the EOR process. Moreover, they are significant for further improving oil displacement efficiency and reducing the injection cost in heterogeneous sandstone reservoirs subjected to the weak-base ASP-flooding process.

An Empirical Study on Options Trading Strategy Using ‘Commodity Channel Index’ For NSE’s Nifty Options in India

Though volume of option trading, specifically in NSE’S NIFTY Index contract, rise significantly over a period of time, it is considered as comparatively complicated due to complexities involve in option. pricing. Volatility in prices play very critical role in option pricing. With help of momentum indicators of technical analysis, one can identify point of expected high amount of volatility in prices. This lead to very high amount movement in option prices. Commodity Channel Index (CCI) is one of the tools of technical analysis which helps in assessing momentum and give hint about future volatility in prices. The present study aims to trace significant (at least double) rise in option price with minimum risk using CCI. For this purpose, historical data of NSE’s NIFTY index was tested on stipulated rules of CCI indicating strong momentum and accordingly creating long position in corresponding in The Money option contracts. The risk and return of using this trading mechanism in NIFTY option was calculated using Return, Maximum Loss Zone, Average Gain to Average Loss Ratio, Strike Rate (Success rate) and its significance. The results are found positive about CCI based trading in option as per stipulated in rules for aggressive traders with time frame of two weeks.

Nitrogen and phosphorus losses by runoff erosion: Field data monitored under natural rainfall in Three Gorges Reservoir Area, China

Nitrogen (N) and phosphorous (P) from agricultural non-point source (ANPS) pollution are the great threats to the regional water quality in the Three Gorges Reservoir Area (TGRA) of China. To explore the pollution of N and P loss from the sloping land in TGRA agricultural areas, field-scale plot experiment under natural rainfall was conducted from May 1 to October 31 in 2012. We monitored and analyzed rainfall, runoff volume, sediment yield, and nutrient concentration under different conditions (3 soil types, 3 surface slopes, and 5 cropping systems) in 30 experimental plots of 20m2 during the rainy season. The results indicated that average loss ratio of N was 1.90%, while that of P was 1.54%. N and P loss ratios from surface runoff in 15° plots of sloping farmland were the highest. Purple soil (PS) was the most severe soil and nutrient loss. Within all the 5 cropping systems, the loss ratios of N and P from intercropping of citrus and grass (C-G) were the lowest. The practice of C-G, which was the most beneficial cropping system, should be further encouraged especially in TGRA to cope with the serious issues of N and P losses. These findings provide useful and valuable information for decision makers and planners to take sustainable measures for the control of ANPS pollution in TGRA, and are beneficial for the agro-ecological environment management of the local agricultural watersheds.

Crop Insurance Loss Performance in 2014

Most payments on 2014 crop insurance policies have been entered into the Summary of Business, a database administered by the Risk Management Agency (RMA). Given relatively complete payment data, an assessment of 2014 loss performance can be made. Overall, loss performance was near “average” when judged relative to the 10-year average loss ratio. In most counties, payments did not exceed total premium. Notable areas of higher losses occurred in 1) western Oklahoma and northwestern Texas and 2) northern Iowa and Minnesota.

Pricing Effectiveness and Regulation: An Examination of Premium Rating in Taiwan Automobile Insurance

This paper examines premium determination of voluntary automobile insurance policies and risk classification under Taiwan’s heavily regulated rating system. On the basis of a unique data set, we investigate the appropriateness of the official one-size-fits-all rating formula for insurers by calculating an actual premium, a pure premium in terms of incurred loss, and a loading factor to account for different insurance coverage types. Empirical evidence indicates that there are large discrepancies between average actual premiums and average pure premiums, requiring large loading factors. The official formula captures the regular loss pattern but not excess claims, due to biased claims’ behaviour. In addition, average loss ratios for all coverage types are closely correlated and profitability is high.

Adaptive radio resource management in an integrated GPRS/UMTS service network

AbstractToday's 2G/2.5G systems are designed to achieve 90‐‐95 per cent coverage. Most operators plan to construct 3G base stations on previous 2G/2.5G stations. Consequently, integrated radio resource management (RRM) is comprised of timeslot‐limited and interference‐limited systems. To improve capacity, this study presents a novel resource management based on timeslot utilisation in an integrated general packet radio service/universal mobile telecommunications systems (GPRS/UMTS) service network. Although this approach gives UMTS high priority for sending data services, it also makes voice services available over general system for mobile communications (GSM). Experiments are performed to analyse the system performance, and indicate two observations. (1) The proportion of data sessions that obtain the required bandwidth is 90 per cent, and the average loss ratio is 1 per cent; the average delay time is qualified to support real‐time services, except for data services in GSM/GPRS. (2) For a heavy load, UMTS and GPRS share the traffic loads efficiently, so the increase in the integrated system capacity is 7.14 per cent and 13.33 per cent for the 64 and 128 kbps data services, respectively. Copyright © 2008 John Wiley &amp; Sons, Ltd.

Relationship between radar-derived hail kinetic energy and damage to insured buildings for severe hailstorms in Eastern Australia

Hailstorms are by far the costliest insured natural hazard in Australia. Major metropolitan areas such as Sydney and Brisbane, located in mid-latitude coastal Eastern Australia, are especially vulnerable due to building exposure and geographical location. Results are presented using data from metropolitan Sydney and Brisbane for seven recent severe storms, including the April 1999 Sydney hailstorm. The focus of this study is on comparisons between the radar-derived pattern of hail kinetic energy and damage to residential buildings in the form of insurance claims. CAPPI (Constant Altitude Plan Position Indicators) reflectivities were generated from S-band radar at low storm levels (1.5 km) and the hail kinetic energy was calculated. High reflectivity hail cells (≥ 55 dBZ) were investigated during the time they passed over occupied urban areas causing damage on the ground to insured assets. The preferred area for hail damage was found to be located to the left side and towards the rear left flank with respect to the storm movement. Higher claim costs were identified within storms that produced “follow up cells.” Two damage variables were derived from insurance claims on a 2 × 2 km grid: average cost and spatial average loss ratio. The radar fields were shifted horizontally in order to maximise correlations between the damage on the ground and the radar signal aloft. Correlation coefficients improved on average from 0.09 before shift to 0.47 after optimal shift for average cost; corresponding values for spatial average loss ratio improved from 0.06 to 0.43. These improvements in correlation are gratifying, especially considering the limitations of the data. Nonetheless, our general conclusion, when looking at all storms, is that hail kinetic energy as calculated in this study cannot by itself provide a robust, consistent and reliable predictor of insured losses.

Effect of loss control service on reported injury incidence

Introduction: A retrospective analysis evaluated the effectiveness of an insurance carrier's flexible loss control service strategy in reducing workers' compensation policyholders' reported injury and illness claims. Objectives: To assess the effects of a loss control service strategy on workers' compensation claim frequency rates, on medical-only claim rates, on severity-claim rates, and on claim cost among a group of California employers. Methods: Eighty-two small- and medium-sized companies with workers' compensation policies expiring in 1999 were randomly selected from a population of policyholders assigned to loss control consultants for two or more years. Claim performance data were obtained for each company's first expired in-force policy year and its 1999 expired policy year. The retrospective design was combined with a control component based on a randomly selected comparison group of 45 companies whose first policy year with the insurer expired in 1999 and who received safety services from the loss control staff. Results: The flexible loss control consultation service strategy was associated with lower average claim rates and costs. Companies assigned to a loss control consultant for two or more years (the “outcome group”) had an average claim rate of 1.24 per $10,000 premium, compared with a rate of 1.62 in the “initial group” and a rate of 1.60 in the “comparison group.” The average severity-claim rate of the outcome group was 0.32, compared with the initial-year and comparison-group means of 0.48 and 0.46, respectively. The average medical-only claim rate was 0.92, compared with the initial- and comparison-group means of 1.14 and 1.14. The outcome group's average loss ratio was over 10% lower than that of the initial and comparison groups. Statistical analysis indicated that differences among the groups' claim rates and severity-claim rates were [ F=(2,206) 4.938, P=0.008] and [ F=(2,206) 8.208, P<0.001], respectively. Conclusions: A loss control service strategy that provides service flexibility and develops partnership between employer and consultant can help reduce the frequency and severity of workers' compensation claims. Barriers to consultation service flexibility, both internal and external, should be identified and removed to enhance service efficacy.

Prioritized statistical multiplexing of PCM sources

Using simple multiplexer models, the performances of two prioritization mechanisms for the transmission of PCM coded signals modeled as exponential on/off sources are investigated and compared with nonprioritized transmission using statistical multiplexing and peak allocation. In both mechanisms the source traffic is partitioned into a low-priority stream and a high-priority stream. In the first approach independent channels of different quality of service are used to transport the two-priority streams. In the second approach a single channel is used in conjunction with a selective packet discarding procedure which attempts to restrict loss to the low-priority traffic. For a given source partitioning, new formulae are given to describe the average loss ratio for the low- and high-priority traffic. The effect of loss on quality for PCM coded signal is quantified by a new formula which relates signal-to-reconstruction-noise ratio to low- and high-priority-loss. The results of the investigation show that both methods of prioritized transmission can provide significant improvements in overall service quality when the channel utilization is high.< <ETX xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">&gt;</ETX>

Non-point-source nutrient losses to the aquatic environment in Denmark: impact of agriculture

As part of a coordinated programme for nationwide monitoring of the Danish aquatic environment, initiated in 1988, nutrient fluxes are measured in 270 rivers, and nutrient cycling is studied in six agricultural catchments. This enables assessment of the degree of non-point-source nutrient loading of Danish surface water and groundwater as well as of the impact of agriculture practised under different climatic and physiographic conditions and with different farming practices. Comparison of annual median losses of total nitrogen and total phosphorus in agricultural catchments and undisturbed catchments revealed an average loss ratio of 14:l for total nitrogen (23.4 and 1.7 kg N ha-1, respectively) and 4:1 for total phosphorus (0.29 and 0.070 kg P ha-1, respectively). Assessment of nitrogen cycling in six small agricultural catchments with either sandy soil or loamy soil revealed marked differences in annual net input to the soil (142 v. 77 kg N ha-1), annual leaching from the root zone (154 v. 78 kg N ha-1), and annual riverine loss of nitrogen (13 v. 25 kg N ha-1). The differences in the rates of leaching and riverine loss in the two soil types reflect the different potential for surface-water and groundwater pollution with nitrogen and also the fact that the denitrification potential is higher in both the soil and the riparian areas of sandy ecosystems. Modelling of data from 77 small representative river basins revealed significant empirical relationships (P &lt;0.001) between annual loss of both nitrogen and phosphorus and various predictor variables (e.g. runoff, proportion of agricultural land, soil type). Runoff and proportion of agricultural land explained, respectively, 41% and 26% of the variance in the nitrogen-model and 45% and 8%, of the variance in the phosphorus model. Such loading models are valuable tools for systems analysis and management at the catchment level, such as when assessing measures implemented to reduce non-point-source nutrient pollution.

The Underwriting Risk and Return Paradox Revisited

Recently, Witt [7,8] suggested that one would expect to find a negative or inverse relationship between mean state loss ratios and standard deviations of the associated annual loss ratios by state for automobile insurance if underwriting risk (as measured by the standard deviation of loss ratios in a state) were properly included in insurance rates, other things being equal. However, based on an empirical test of this hypothesis, he found a direct rather than an inverse relationship between these variables. Hedges [3] later argued that the observed positive relationship could have resulted from a mathematical relationship between the average loss ratios and standard deviations and/or from certain institutional factors which affect loss ratios and insurance rates in the various states. Based on some empirical tests of economic and institutional factors, Witt [9] showed that Hedges' institutional hypothesis could not be verified. His regression results for the whole industry showed a positive relationship between the underwriting risk and return variables even after he included various economic and institutional variables in the regression model. The regressions for the direct-writing, national-agency, and regional-speciality companies also revealed a positive relationship between the means and standard deviations of loss ratios by state. Thus. the addition of some institutional variables to his regression model did not reverse the significant positive relationship between mean loss ratios and standard deviations by state. Accordingly, he argued that the perverse observed positive correlation could not be easily explained by differences in institutional factors among states.' In regard to Hedges' mathematical hypothesis, Witt [91 argued that if the annual loss ratios by state are normally distributed there should be no relationship between the averages and the standard deviations of these ratios because there is no mathematical relationship between the mean and variance of a normally distributed random variable. Witt indicated that the Central Limit Theorem would suggest that the annual loss ratio in a state should be normally distributed because it is nothing more than the weighted average loss ratio of all the companies writing a given coverage in the state. Hence, he argued the positive correlations he observed could not be reasonably explained by the

Comments on the Exchange between Hedges and Witt

The recent exchange between Hedges [1] and Witt [2] prompts a few additional comments. These are motivated by a concern for the misconceptions that might be created by those comments, not by a desire to take sides. Witt [3] had found a positive correlation between the temporal average of the loss ratio of automobile insurers in 51 jurisdictions and the standard deviation of the annual results from the temporal mean for each jurisdiction. The main issue in the exchange is whether one should view as surprising the fact that the correlation was positive. Hedges [1] proposes a mechanism which suggests to him that the correlation should be positive, and Witt [2] counters that the mathematical relation and institutional factors proposed by Hedges do not tend to make the correlation positive. The present comment addresses two issues: the relevance of the central limit theorem to the belief that the mean and standard deviation should be independent unless there are real, structural effects, and the relevance of the standard deviation as a measure of risk in the empirical study. Witt states: Mathematically, it can be shown that there is no relationship between the mean and variance of normally distributed random variables. Since the annual loss ratio of all the companies is nothing more than the weighted average loss ratio of all the companies writing a given coverage in a state, the Central Limit Theorem would suggest that the annual loss ratio in a state should be normally distributed. Therefore, it would seem quite reasonable to argue that there is no mathematical relationship between the mean and the variance of the annual loss ratios in a state. [2] This argument is not valid.

Author's Reply: Underwriting Risk and Return: Some Additional Comments

In a recent paper, the author suggested that one would expect to find an inverse relationship between mean loss ratios and standard deviations of the associated annual loss ratios by state for automobile insurance if this coverage were properly priced.1 In other words, one would expect lower underwriting profits to be associated with higher loss ratios, and therefore, a company would have to anticipate lower underwriting risk in order to have an economic incentive to sell automobile insurance in such states. Accordingly, one would expect that the average loss ratios and standard deviations for a given coverage in the various states would vary inversely with each other if underwriting risk were properly reflected in the insurance rates for the coverage, other things being equal. In order to test this economic hypothesis for various automobile insurance coverages, the correlation coefficient between the mean loss ratios and standard deviations for the various states was calculated to determine if an inverse or negative relationship existed. However, a positive rather than a negative relationship was found between these variables. The author found this empirical relationship to be somewhat surprising.

Regulation and Price Rigidity in the Property-Liability Insurance Industry

The relation between rate regulation and underwriting experience in the property-liability insurance industry is examined. Average actual loss ratios are compared across states classified according to the presence or absence of regulation. The average loss ratios generally are higher in states with some form of rate regulation than in states without regulation. Such adverse underwriting results have been attributed to price rigidity imposed by regulation. In order to test this hypothesis a simple model of rate adjustment is formulated where the effect of regulation is interpreted as a leftward shift in the cumulative probability distribution of a price adjustment coefficient. The empirical results support the existence of rigidity imposed by regulation.