premium rating

Premium rating is the process insurance companies use to determine the amount you pay for your insurance policy. They assess various factors such as your age, health, the type of coverage you want, and other risks to set a fair price. Essentially, it’s how insurers balance the potential cost of those they insure with the premiums they collect, ensuring they have enough funds to pay future claims while remaining competitive. Different risk profiles lead to different premium amounts, ensuring each policyholder’s rate reflects their specific situation.