Abstract: ZIP code connection matrices are created for use in insurance ratemaking by identifying common borders of geographically defined regions. ZIP codes and associated cartographic boundaries are read from a database. Pairs of coordinates for the boundaries are stored in a matrix and values are calculated that represent each pair of coordinates in the matrix. The calculated values are stored in an encoded coordinates matrix and used to determine common segments. A connection matrix is formed representing connections among ZIP codes. A neighborhood matrix is then calculated, which stores values that represent an indication of closeness of each ZIP code in the neighborhood matrix to a target ZIP code.