How the Premium is actually calculated?
- This topic is empty.
-
Posts
-
dharna
Premiums charged by the companies helps the costumers to cover with the financial losses. So Premium need to be convincible for the costumer too i.e one should feel that the premium is worth paying for the risk. Premium mailny constitutes of three components: Profit Margin , Pure Claim Cost , Expenses. So, the actual process goes like as follows – Firstly, a benchmark premium i.e a basic premium is decided then the underwriting adjustments are done e.g adjustments for smokers, non- smokers ,etc. then the technical premium is decided.Afterwards, the premium is aligned according to the Sum Assured, higher the S.A, higher the premium.Then, Actuary decides the target premium but the underwriter does not agree with the price.So, a dispute is created and CEO plays the role and decrease the premium to the “Walkaway Premium”, still the underwriter does not agree with the price. So, it is further reduced to “Actual Premium” which is very very low than the price quoted by the Actuary. Sent from my SM-J700F using
Actuarial Info mobile appMayank Goyal
Dharna wrote:
Premiums charged by the companies helps the costumers to cover with the financial losses. So Premium need to be convincible for the costumer too i.e one should feel that the premium is worth paying for the risk. Premium mailny constitutes of three components: Profit Margin , Pure Claim Cost , Expenses. So, the actual process goes like as follows – Firstly, a benchmark premium i.e a basic premium is decided then the underwriting adjustments are done e.g adjustments for smokers, non- smokers ,etc. then the technical premium is decided.Afterwards, the premium is aligned according to the Sum Assured, higher the S.A, higher the premium.Then, Actuary decides the target premium but the underwriter does not agree with the price.So, a dispute is created and CEO plays the role and decrease the premium to the “Walkaway Premium”, still the underwriter does not agree with the price. So, it is further reduced to “Actual Premium” which is very very low than the price quoted by the Actuary.Sent from my SM-J700F using
Actuarial Info mobile app
I appreciate you putting out in such a beautiful way. I believe this is the process for LI, right?
- You must be logged in to reply to this topic.