View Full Version : Experience and Schedule Rating
04-28-2011, 02:00 PM
Quick question: 2005 # 54 involves both experience and schedule rating. At my company, and strictly from the definition of schedule rating given in W&M, the calc goes like this:
Manual*(exp cred/deb + sch cred/deb).
The sample answer uses exp *sch. Is this another one of those things where it doesnt really matter and the graders arent going to care?
04-28-2011, 02:14 PM
W/M doesn't show any calculations where you combine the two methods, so I'd just go with that prior exam question and multiply them. Probably another situation where it doesn't matter.
04-28-2011, 02:53 PM
It'll depend on the rating plan.
My work with commercial is that the schedule rating is a separate item from the rest of the manual rating plan (which includes the experience rating adjustment); and it's applied multiplicatively.
This is done since any scheduled adjustments has to be clearly documented to support given the particular adjustment (especially if it's a debit). Once you start modifying other rating factors based on this, it can get real messy from a practical and implementation stand point (unless you're hand rating every single policy, which isn't the case for most policies).
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