Rate Development

An insurance rate is

Rating components are the factors that determine the rate assigned to a particular class, which are used to determine the premium charged. Which of the following is NOT a rating component?

Experience rating uses the insured’s past experience to determine future premiums, while retrospective rating uses

When are individual rating methods used?

What is another name for class rating?

How is the premium determined when class rating is used?

Which is NOT an example of using the schedule rating method?

Which insurance industry commonly uses judgment rating?

Timothy received all A’s on his report card, and therefore, the insurer reduced his auto insurance premium. This is an example of 

Bill’s Butcher Shop recently received its Workers Compensation annual premium notice. Next year’s premium is increasing 25%, because five butchers had work related injuries in the past year. This is an example of 

The policy period of Donald’s Door Manufacturing’s policy was January 1, 2021 to January 1, 2022. The annual premium for this insured was estimated to be $41,000 when the policy period started. Because this insured filed several claims during the policy period, the insurer increased the annual premium to $48,000 at the end of the policy period. Therefore, the insured was required to pay an additional $7,000 for the 2021 policy period. This is an example of 

Which is NOT an individual rating method?