LER 425 Benefit Costing: Experience Rating essay

The experience rating of benefit plans achieves the ultimate degree of premium equity among policy holders.

In your essay, please comment on the following:

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  • Define experience rating
  • Why might this be a more fair way to rate benefit premiums?
  • Why is it not used every time benefit premiums are rated?
  • Are there any drawbacks to using experience rating and why?
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