When determining the premiums for large groups, most insurance companies use
A. Occupational rating
B. Area rating
C. Pooled rating
D. Experience rating
Answer (2)
Most insurance companies use Experience rating to determine premiums for large groups based on their loss history. Alternative methods like Occupational rating , Area rating , and Pooled rating exist, but Experience rating is the most common for large insurers. This method allows for tailored premiums based on past claims data. ;
Most insurance companies use Experience rating to set premiums for large groups, which is based on the group's individual loss history. This method personalizes premiums according to past claims, unlike other methods such as Occupational, Area, and Pooled ratings. Experience rating ensures that the cost of insurance reflects the actual risk of the group.
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