Contents
0.
Overview of this FAQ
1. MarketStance
Versions and Releases
2. The
MarketStance Universe of Businesses
3. MarketStance
Data Sources
4. MarketStance
Methodology
5. MarketStance
Measures
6. MarketStance
Dimensions
7. Workers
Comp
8. The
MarketStance Web Site
(MarketStance Online)
9. PowerPlay
10. MarketStance
Training and Support
0.
Overview of this FAQ
MarketStance Analyst is a PowerPlay-based
product that is often the best solution
for equipping small groups of sophisticated,
analytically-oriented users working on
strategic and cross-functional business
issues who need the flexibility to design
their own reports and answer "what-if"
type questions.
The MarketStance Analyst FAQ provides
answers to the most frequently asked questions
about this MarketStance product. .
If you do not find the answers to your
questions here, please call the MarketStance
help desk at 1-888-777-2587 between
the hours of 8:00 AM and 5:00 PM, EST,
or e-mail the help desk at helpdesk@marketstance.com.
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1.
MarketStance Versions and Releases
Q: What is the latest version of
MarketStance Analyst?
A: As of February 2008, the most current version of MarketStance Analyst for Commercial Lines is Version 7.1. This version contains 2006 insurance statistics and business demographics as well as loss ratios for Workers Comp and Commercial Auto. MarketStance customers can choose to receive this update in either a SIC equivalent or NAICS business classification format. MarketStance
customers can choose to receive this update
in either an SIC equivalent or NAICS format.
Q: What information can MarketStance
Analyst provide?
A: MarketStance Analyst offers
numbers of accounts, premium estimates,
exposure information, growth rates and
loss ratio estimates for selected lines.
It provides this information by class
of business, location, and/or account
size.
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2.
The MarketStance Universe of Businesses
Q: Does MarketStance cover all businesses
and employees in the U.S.?
A: Most, but not all. MarketStance added information on municipal, county and state government entities in Version 7.1. It still does not include information on federal government entities or quasi-government corporations (such as the Postal Service), railroads. Additionally, some community colleges are not presently included.
Q: Because of disclosure concerns,
the published County Business Patterns
suppresses data on individual firms.
How is it possible for MarketStance to
show single accounts?
A: County Business Patterns
suppresses demographic data on employees
and total payroll when there are 3 or
fewer competitors in any geographical
area - the number of firms is reported
regardless of disclosure concerns. MarketStance
uses proprietary algorithms to impute
the employment and payroll data.
Q: Do you include information for
S-corporations or home companies?
A: MarketStance currently does
not differentiate companies based upon
their form of ownership (e.g. S-corporations),
tax status (e.g. tax -exempts) or in-home
location.
MarketStance is developing additional
data that will allow users to sort by
form of ownership, and thus to differentiate
publicly held corporations, closely held
corporations (i.e. S- and C- corporations),
and partnerships/sole proprietorships.
Q: How are schools and colleges handled
in MarketStance?
A: MarketStance data includes private schools and colleges. Public schools, with the exception of community colleges, are included as of Version 7.1
Q: How are franchisees handled?
A: Franchisees are reported
as independent businesses. For example,
a McDonald's franchisee shows up as a
separate business, not as part of the
McDonald's corporation. If a franchisee
owns more than one franchise, if all of
those franchises operate in a single county,
and if they operate out of a single payroll,
then the combined business operation is
reported in MarketStance as one business.
Q: Some SIC codes end with an “A”
– for example, 399A. What does this mean?
A: An "A" at the end of an SIC
designates "auxiliary" establishments.
These are company offices or locations
which perform purely administrative functions
to support the company's business operations.
The SIC code captures the type of business
operations that are supported by the administrative
establishment.
Q: What is SIC 9999?
A: These are Unclassifiable Business Entities (UBEs), businesses that indeed exist, but have not been classified by the government into an SIC, even at the single digit level. There are a surprising number of these firms—about 40,000—and combined they represent over $1 billion in payroll. MarketStance Version 7.1 included them for the first time under a new SIC: 9900. With the adoption of the NAICS classification system and the reexamination of business classifications that took place with the 1997 Census, the number of these Unclassifiable Businesses significantly decreased.
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3.
MarketStance Data Sources
Q: What data sources are in MarketStance?
A: The following sources are
included in MarketStance Version 7.1:
- Insurance industry 2006 Written Premium
data by state and line of coverage.
- County Business Patterns for 2005
- Economic Census of the U.S. for 2002. The Economic Census data includes information on payroll and sales.
- Bureau of Labor Statistics' Empolyer Survey as of September 2007
- Vehicle Inventory and Use Survey of 1997 and 2002
Q: Does MarketStance reflect Best’s
data?
A: Yes. Marketstance premium information is benchmarked to the latest
Best by-line, by-state data.
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4.
MarketStance Methodology
Q: How does MarketStance adjust for
alternate markets (i.e., captives, self-insurance)?
A: The first step is to estimate
total premium potential at carrier base
rates. Then the slice of premium potential
attributable to alternative markets is
estimated from survey data on corporations
reliant on alternative markets. This estimated
reduction in premium potential is then
subtracted from the total premium potential
estimates. The remaining premium dollars
are then reconciled to Best's byline,
by-state data to arrive at final estimates
of the "traditional" commercial insurance
market. It should be noted that, for MarketStance
purposes, state workers compensation funds
are included within the definition of
the traditional market by adding their
premium receipts to the insurance statistics
reported in Bests.
Q: Is the MarketStance estimate of
premium lost to alternate markets available
to users?
A: Although alternative potential
premium estimates are most appropriate
for the MarketStance databases that look
at business on an enterprise basis, it
is possible to add these ART premium estimates
to any MarketStance database.
Q: Does MarketStance take “mods”
into account?
A: Yes. Carrier modifications
to filed rates are estimated by reconciling
MarketStance's "bottom up" premium estimates
to Best's byline, by-state premium totals
(adjusted for state workers comp funds).
For each state, premium estimates for
establishments in every combination of
4-digit SIC, county, and firm size are
calculated, then summed byline (Any
workers comp premium going to state funds
is added to the workers comp roll-up.)
The differences between this roll-up and
Best's byline totals for each state are
attributed to rate mods, and the MarketStance
preliminary premium estimates are adjusted
accordingly.
Q: How does MarketStance handle businesses
that have decided to go “bare,” i.e.,
who make no provision for insurance?
A: In the current version of
MarketStance, the counts of establishments
and the exposure data (employment, payroll,
sales, etc.) include firms that go bare,
but no estimate of potential premium from
these firms is made. That is, the current
version of MarketStance makes the implicit
assumption that firms currently going
bare do not represent a source of potential
premium to carriers.
In the MarketStance Special Liability
breakout, counts of covered businesses
for the various special lines, such as
D&O, E&O/Professional, EPLI, and
Fiduciary, are specifically included.
Q: Do the value of structures figures
include the value of buildings under construction?
A: No. Only the value of completed
buildings is reported. The values reported
are undepreciated book values.
Q: How does
MarketStance treat equipment that is permanently
mounted or installed?
A: Permanently
mounted or installed equipment if captured
in Value of Equipment. It is not part
of the Value of Structure figures.
Q: What are the components of the
Property and Liability lines?
A: Property consists of:
CMP Fire, Fire and Allied. Liability consists
of: CMP Liability, General Liability,
Product Liability, and Liability - Other.
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5.
MarketStance Measures
Q: In the Risk Assessment Cube, one key MarketStance measure is
“number of accounts.” What is an “account?”
A: Consistent with County Business
Patterns, MarketStance tracks establishments,
not companies or enterprises. More
specifically, MarketStance establishments
are distinct payroll locations. This means
that businesses operating in multiple
locations often show up in MarketStance
as more than one account. There
is no under- or over-counting of employment,
sales, premium, or exposure, however,
since these measures are also developed
on an establishment basis.
MarketStance does provide data at the
enterprise or headquarters level as well.
These measures are developed separately
on an enterprise basis.
Q: What is the MarketStance definition
of premium? Does it include premiums and
equivalents? Does it include losses subject
to a deductible?
A: MarketStance estimates of
premium correspond most closely to the
direct written premium concept reported
on the Statutory blank. After aggregation,
our estimates are reconciled with the
by-state, byline data tabulated by Bests,
with the exception that we include the
premium writings of state workers comp
funds in our estimates. Specifically
excluded from our published data at this
point are forms of alternative market
premium equivalents typically used by
larger insureds, including risk retention
pools, captives, and "above average" deductibles.
The cost of risk associated with standard
deductibles are excluded from our premium
potential estimates.
Q: Are premium growth rates available
in MarketStance?
A: No. Later versions
of MarketStance may provide estimates
of premium growth assuming current rates
(i.e. exclusive of possible changes in
effective rates during the forecast period).
Q: Why do some rows show zero firms
and negative 100% growth in number of
firms?
A: These are categories for
which the number of firms fell to zero
sometime during the 2002-2006 historical
period. They must be included to insure
that aggregate historical growth rates
are calculated correctly.
Q: Why do historical growth rates
show more county-to-county variability
than those of previous versions?
A: In earlier versions, historical
county-level growth rates were smoothed
somewhat to make county-to-county comparisons
easier. In the current version, 2002-2006
growth rates are calculated directly from
County Business Patterns (after adjustment
to remove reporting anomalies in the published
data). This was done to keep more aggregated
growth rates as consistent as possible
with the growth trends captured in the
County Business Patterns data.
Q: Why don’t the 4-year growth rates
look consistently larger than the new
2-year rates?
A: MarketStance reports growth
rates on an average annual basis rather
than on a cumulative basis. As a result,
the rate of growth between the 2- and
4-year periods can be directly compared
from the reported measures. Cumulative
growth, however, must be calculated.
Q: How should cumulative growth (over
the 2- or 4-year period) be calculated?
Can I simply multiply the reported rate
by either 2 or 4?
A: Multiplying the reported
rate by the time period will provide a
quick approximation of the cumulative
growth, but will not be exact. This is
because MarketStance rates of growth are
reported on a compound annual rate basis.
Exact cumulative growth can be calculated
by the formula "g = ((1+r)*n)-1" where
"g" is the desired cumulative growth,
"r" represents the reported rate of growth,
and "n" is the number of years.
Q: Where is the eight years of historical
data you talked about?
A: MarketStance provides twelve
growth measures, six historical and six
forecast:
- The historical average annual growth
rate of the number of accounts (establishments)
for the 2002-2006 period and the 2004-2006
period.
-
The historical average annual growth
rate in employment for the 2002-2006
period and the 2004-2006 period
- The historical average annual growth
rate in total payroll for the 2002-2006
period and the 2004-2006 period
- The forecast average annual growth
rate of the number of accounts (establishments)
for the 2006-2008 period and the 2006-2010
period
- The forecast average annual growth
rate in employment for the 2006-2008
period and the 2006-2010 period
-
The forecast average annual growth rate
in total payroll for the 2006-2008 period
and the 2006-2010
Q: Are the growth rates average annual
or total over the period?
A: Average annual.
Q: How current is the data in MarketStance?
A: The data in MarketStance
7.1 is as of 2006:
- Number of accounts: Year-end 2006
- Employment: March 1, 2006
- Payroll: Annual 2006
- Premiums: Annual 2006
- Exposures: 2006
Q: The employment numbers look wrong
for some industries, particularly in relation
to payroll. What’s going on?
A: Because employment is as
of March 1, industries that experience
marked seasonal cycles may appear to have
unexpectedly high or low employment in
MarketStance. Tax preparation services
(SIC 7291), for example, employ a large
number of temporary help at that time
of the year, seasonally increasing reported
employment.
Q: Are the employment numbers in
MarketStance for full-time employees,
only or are part-time employees also included?
What about the payroll data?
A: Both full-time and part-time
employees. Payroll numbers also
include both. Every employee on a payroll
when the Economic Census is taken (last
pay period in March) is counted as one
employee. As such, employee count is subject
to distortion both by seasonal work fluctuations
and by part time employees.
Q: Is loss information available
in MarketStance?
A: Yes, currently MarketStance
contains loss information for Workers'
Comp, and Commercial Auto.
Q: Are the values of structures and
equipment book value, or market value?
A: Book value.
Q: Are dollar amounts in MarketStance
current dollars?
A: Yes (in thousands).
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6.
MarketStance Dimensions
Q: What are we doing with the new
SIC codes? Are they just extensions of
the old ones or do they represent the
opportunity for a niche market?
A: The new North American Industrial
Classification System (NAICS) represents
a significant improvement over the Standard
Industrial Classification codes, which
were originally developed in the 1930s.
In addition to greater detail (5-plus
digits), the NAICS system is much better
aligned with underwriting. This is because
the new classifications are keyed to work
and production processes, rather than
to the good or service being produced.
For example, under the SIC system, fully
integrated steel mills - which produce
finished steel from raw materials - and
mini-mills were put the in same classification.
The NAICS system places these two in different
classifications, reflecting their very
real differences in insurance risk.
MarketStance offers subscribers the choice
of classifying business by SIC-equivalent
or NAICS codes with Version 7.1.
Q: If “Non-employers” have no employees,
why do I see data on employment and payroll
for these businesses?
A: Even though non-employers
have no paid employees and hence no payroll,
each of these businesses has an owner
or partners who run the business, and
who receive income from that business.
The "employment" measure for non-employers
estimates the number of owners/partners
for these firms, and the "payroll" number
estimates a payroll equivalent based on
their personal income from the business.
An asterisk (*) on the Employment and
Payroll measures in the categories box
flags this nuance.
Q: The “Employment” and “Payroll”
measures have asterisks after them. What
does that mean?
A: See question above.
Q: Are non-employers synonymous with
home-based businesses?
A: No. While a large percentage
of non-employers are home-based, many
employer-firms are also home-based.
Moreover, a significant share of non-employers
operate outside the home.
Q: What is
a Non-Employer?
A: These are
businesses that have no paid employees.
These businesses can include many professional
firms, LLPs and LLCs as well as full-time
self-employed entrepreneurs, and persons
who run businesses part time.
Q: When I look at the average premium
per account for All Account Sizes, I get
averages that look too low. What’s going
on?
A: Many of the newly-added non-employers
do not purchase insurance, choosing
to go "bare." The average premium
per account is biased down by these large
number of "bare" firms. Excluding
these firms from your firm counts will
allow you to approximate the average
premium per account covered.
Q: Within the non-employers category
itself, the average premium per account
appears very low, even after taking into
account their very small size. What’s
wrong?
A: See question above.
Q: Can I filter on the not-for-profit
firms?
A: Not-for-profits have been
included in the database, but are not
separately identifiable.
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7.
Workers Comp
Q: Do the workers comp numbers take
into account the fact that some states
have state-run workers comp plans, some
are wholly private, and others have a
mixed market?
A: Yes.
Workers comp premium estimates in MarketStance
include estimates of premiums paid to
state-run comp plans. These estimates
have been developed for both monopolistic
and mixed-market states.
Q: In estimating
workers comp premiums, does MarketStance
take into account the very different rates
for production and non-production workers?
A: Yes.
In estimated workers comp exposures and
premiums, MarketStance estimates production
and non-production components separately.
The workers comp estimates in MarketStance
thus more accurately reflect the differences
in employment mix across industries.
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8.
The MarketStance Web Site
Q: Where do I find web versions of
Fritz Yohn’s articles for National
Underwriter?
A: The URL is www.marketstance.com.
Click on What's New/Archives to view other
articles and position papers. MarketStance
regularly adds to its article collection.
You can receive e-mail notification when
new information is posted by registering
on the site.
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9.
PowerPlay Series 7
Q: What operating
systems is the MarketStance Analyst CD-ROM
product compatible with?
A: MarketStance
will run under Windows 95, 98, 2000, XP,
NT 4.0 with Service Pack 4 or Vista. In order to run on Windows Vista
you must be running Cognos PowerPlay v7.4.
Q: Sometimes
"/0" appears in a cell. What does
this mean?
A: "/0" indicates
that an attempt has been made to divide
by zero. This can occur when the
Average premium per account measure is
selected, and the number of accounts in
the market definition is zero, or in a
calculated field when the denominator
is zero.
Q: Can MarketStance
Analyst data and reports be exported to
other applications?
A: Yes.
Data and reports from MarketStance Analyst
can be exported as comma delimited ASCII,
PDF, or Excel files. Most
other applications - such as Lotus - can
read files in one or more of these formats.
MarketStance Analyst tables and charts
can also be pasted directly into other
Windows OLE-compliant packages such as
PowerPoint or Adobe PageMaker. MarketStance
Analyst also provides a macro that automates
the export of a report created with PowerPlay
to Excel.
Q: After
installing PowerPlay, I get an application
error message when I try to start up.
The install seemed to go fine, what's
wrong?
A: Check the
video settings to make sure they are set
at 256 colors or higher. To check
these settings, right click on the desktop,
select properties, select display adapter.
(The error messages you might get under
these conditions are: "Illegal Operation";
"Application Error has occurred in powerplay.exe";
or "Exception access violation" and
a memory address.)
Q: How can
I improve the performance of PowerPlay?
A: Following
are some hints that will help improve
the speed of PowerPlay reports. Please
contact the Help Desk at any time for
hints that may be more specific to your
situation.
Close other Applications: Less
memory will be available to PowerPlay
if you have other applications running
at the same time, slowing down PowerPlay.
Close as many other applications as possible
to maximize performance.
Drilling Down on States: Unless
you are using a customized data cube,
do not drill down through Census
Regions since in the standard data cube
this is the alternative drill down path
and therefore not optimized.
Number of Measures: One of the
key factors in determining the update
and exporting speed of PowerPlay reports
is the number of measures displayed. The
more measures in the rows, columns or
layers, the slower the performance. Use
only the measures you need. Also, as you
construct a report, add the measures last.
Number of categories: Another important
factor is the number of rows, columns
or layers in the report. A report with
all 1,800 SICs or all 3,195 counties in
the rows, for example, will run very slowly.
Exporting to Excel: Very large
reports -- those with many rows or many
measures in the columns or layers for
example -- can take a very long time to
successfully export to Excel. An alternative
is to use the Export to Excel macro, available
in the help folder on the MarketStance
CD or from the Help Desk. This not only
improves exporting speed to Excel, but
also creates an Excel spreadsheet with
report layers in tabs. Contact the Help
Desk to obtain this macro.
Excel imposes some
limitations you should be aware of when
exporting from PowerPlay. When exporting
a report with layers, the Export to Excel
macro will open Excel, copy the information
in the PowerPlay report and paste it into
Excel, creating and labeling a worksheet
for each layer. Make sure the layer
labels are no longer than 31 characters
and that they do not contain the following
symbols - : / \ ?
* [ or ] and that they are not blank.
The maximum size of an Excel worksheet
is 65,536 rows by 256 columns.
Customization: It is also possible
for us to customize your MarketStance
cube to optimize performance for the type
of reports you most commonly create. Contact
the Help Desk for more information.
Q: I created
a report which adds several columns (or
rows or layers), then selected Average
Per Account as one of the measures. The
Average Per Account doesn't look right,
although the other measures look fine.
What's wrong?
A: If you add
two or more columns, rows, or layers together
then select the Average Per Account measure,
PowerPlay assumes you want that measure
added as well - thus the result is not
an average but the sum of two or more
averages. Select ROLLUP from the
Calculate menu to preserve the integrity
of the calculations in the All Lines Premium,
Average Per Account measure.
Q: I've added
several columns (or rows or layers) together
and then selected a growth measure for
my report. The result just doesn't
look right. What's going on?
A: If you add two
or more columns, rows, or layers together
then select a growth measure, PowerPlay
assumes you want that measure added as
well - thus the result is not a growth
rate of the totals, but a total of the
growth rates. Select ROLLUP from
the calculate menu to preserve the integrity
of the calculations in the growth measures.
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10.
MarketStance Training and Support
Q: What kind of training does MarketStance
provide?
A: New MarketStance clients
receive a free day-long, on site training.
Experienced users may take advantage of
a free day-long session held in Middletown.
Arrangements may be made for the MarketStance
trainer to conduct on-site training by
calling 1-888-777-2587, extension 6384.
In addition, MarketStance contains extensive
on-line help, complete user manuals and
documentation.
Q: Does MarketStance have a Help
Desk?
A: MarketStance provides free
telephone help desk support that is available
between the hours of 8:00 AM and 5:00
PM (Eastern Time) by calling 1-888-777-2587.
Help Desk questions can also be e-mailed
to helpdesk@marketstance.com.
Q: What happens if we need a refresher
after the training session has taken place?
A: If at any time a question
arises or a refresher training session
is necessary, you only need call the Help
Desk at 1-888-777-2587 to schedule a WebEx
session.
Q: I’ve just been given a big project
to do using MarketStance and I’m not sure
where to start or what to do. Can you
help?
A: Certainly. The Help Desk
is more than just a place to get answers
to technical or data questions. The Help
Desk is available to hands-on users as
well as data requesters to help with any
insurance information related issues.
We can help with advice, report creation,
templates, or additional information not
contained in the MarketStance database.
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