Pricing Group Insurance Flashcards by McKenna Ahlgren | Brainscape

Q

Pricing Group Insurance

Gross Premium Formula

A

= Claim Cost + Expenses + Taxes + Profit - Investment Income

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Q

Pricing Group Insurance

Admin Expenses

A

Expenses to design, develop, sell, UW, and administer product

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Q

Pricing Group Insurance

Admin Expenses: Considerations

A

How to allocate to product/group
What does competition include as expense in its pricing?

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Q

Pricing Group Insurance

Admin Expenses: Source of Data

A

Internal = What is needed to cover operating costs
External = Shows market demands

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Q

Pricing Group Insurance

Taxes

A

State Premium Tax
Federal/State Income Tax
Federal Assessment on Health Coverage (ACA, revoked in 2021)

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Q

Pricing Group Insurance

Group-Specific Adjustments

A

Large groups = use own experience
New business discounts
Economies of scale for jumbo groups (enrollment, billing, admin)
Self-insured loadings

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