Underwriting
Experience Rating
An underwriting method that adjusts an insured's premium based on their individual claims history relative to the expected claims for their risk class. A firm with fewer or smaller claims than average receives a premium credit, while a firm with worse-than-average claims experience faces a surcharge. The experience rating period typically covers the most recent five to seven years.
Related terms
Loss RatioThe ratio of claims paid (losses) to premiums earned, expressed as a percentage. A loss ratio of 60 ...UnderwritingThe process by which an insurance carrier evaluates the risk presented by a prospective insured and ...Risk Management CreditA premium discount offered by malpractice carriers to law firms that implement approved risk managem...