CAS CLV Pricing — Bi-Weekly Call Brief

Call: Thursday, July 2, 2026 · 4:30 PM EST · Call #2 of the bi-weekly series Project: Customer Lifetime Value Pricing (CAS Ratemaking Working Group) Phase: 2 — Data Architecture & Synthetic Data (CAS window Jun 25–30) · Phase 3 opened Jul 1 Researcher: Pramod Misra (5G Vector partner: Neha Tiwari) CAS staff / coordinators: Elizabeth Smith (), Heather Davis () Project Oversight Group (reviewers): Mark Mondello (QBE), AJ Robinson (Allstate), AJ Paik, Geoff Werner (Werner Advisory), Ronald Kozlowski (RTK Services) Master log of all calls / updates / POG inputs: docs/calls/README.md

1. Agenda (proposed, ~30 min)

1. Phase 2 close-out + Phase 3 kickoff (5 min) — §2
2. Framework refinement: two-variant CLV reporting (10 min) — §3
3. Next two weeks / Phase 3 build plan (5 min) — §4
4. Open action items + carryover from Call #1 (5 min) — §5
5. AOB / next call Jul 16 (5 min)

2. Status: Phase 2 closed on schedule; Phase 3 underway

Phase 2 — Data Architecture & Synthetic Data (window Jun 25–30) — ✅ complete - docs/02_data_architecture.md + cas_clv.data: synthetic generator mirroring the Applied Epic agency-management data model — multi-year, multi-product (auto / home / commercial BOP) customer / policy / claim histories, fully deterministic under set_seed(42). - No proprietary agency data enters the repo (synthetic-first, per the kickoff decision); public sources remain available for calibration. - QA gate green throughout: pip install -e . · pytest · ruff · mypy.

Phase 3 — CLV Model Development (window Jul 1–14) — 🟡 in progress - First model in place: BGNBD_CLV — native, scipy-only BG/NBD (Fader–Hardie–Lee 2005) with each policy renewal treated as a purchase occasion; discounted expected renewals × net annual margin. This is the probabilistic base of the POG-selected hybrid headline model, with fit() / predict_clv() / sensitivity_analysis() on the common interface. - Fully auditable implementation (no dependency on the unmaintained lifetimes package); engineering rationale in docs/03_dependency_decisions.md.

3. Framework refinement for POG review — two-variant CLV reporting

Adopted into the framework this week (docs/01_clv_framework.md §2.1): every model reports CLV in two variants, side by side:

• The constrained variant makes the framework's X term concrete as cross-sell (products added to the household — Verhoef–Donkers 2001 "potential value") plus upsell (coverage-tier / limit upgrades — the Markov transition dynamics).
• The gap between the two columns is exactly the discounted value attributed to business-development assumptions — an auditable decomposition for both regulators and management, and it operationalizes the actuarial-vs-business-optimization bright line from Call #1.
• Already wired into the toolkit: predict_clv() returns both columns; sensitivity_analysis() sweeps cross_sell_value and upsell_value as explicit grid dimensions.

POG input requested: confirm the labels ("constrained / unconstrained" vs e.g. "filing base / business-potential"). The decomposition stands regardless; only column names change.

4. Next two weeks (Phase 3 window → call #3 on Jul 16)

• ParetoNBD_CLV (native, on the shared RFM pipeline) — the Schmittlein (1987) benchmark beside BG/NBD.
• Cox PH / AFT survival models (time-to-lapse hazard; Brockett 2008 specification).
• MarkovCLV + HMM latent states (coverage-tier / product-addition transitions; Dong–Frees 2022 template).
• notebooks/01_data_exploration.ipynb and the start of the model comparison table.
• Calibrate synthetic economics toward the proposal's illustrative ~$4,890 5-year CLV worked example.

5. Open action items

• CAS: status of ScholarOne access + github.com/casact repo provisioning (targeted ~Jun 19).
• CAS: confirm the RPM Seminar presentation date (targeted ~Jun 30).
• POG (carryover from Call #1): any remaining steer on the nine framework questions (horizon basis · reporting grain · discount rate · cross-sell line across states · hybrid interpretability · expense/loss conventions · per-line vs pooled · regulatory proxy rigor · worked-example calibration) — plus §3 terminology above.
• Researcher: continue Phase 3 build; weekly written Friday updates continue (next: Jul 3).

6. Artifacts (available on request / in repo)

• docs/01_clv_framework.md (incl. new §2.1) · docs/02_data_architecture.md · docs/03_dependency_decisions.md
• src/cas_clv/ (data, features, _btyd, models) · tests/ (15 tests, QA green)
• docs/literature/00_literature_review.md · research/papers/ (16-item corpus + manifest)