The accident numbers for the oldest drivers skew perceptions among auto insurance risk analysts, who tend to characterize the entire population of over-65 drivers as “high increasing risk” This means that drivers between 65 and 75, whose accident rates remain relatively close to drivers in the middle-age categories, subsidize the drivers over 75. (more…)

The insurance functions of Blue Cross and Blue Shield plans were pretty simple in their early years. The plans engaged in community rating. This simply meant that all of the subscribers of a plan were in one large risk pool. Insurance premiums were determined essentially by projecting the growth of insurance claims and dividing by the number of subscribers. Commercial insurers began to challenge this in the 1950s through experience rating, and by the 1960s, experience rating had driven out community rating. (more…)

Surety Association of America determine bonds’ rate. Fire insurance company offered fire insurance rates which actually decided and regulated by regional, state-wide inspection rating bureaus. Rating bureau company determines the rate by first gathering statistics then formulate rates to be implemented in an approved policy forms. This organization is not only responsible for setting insurance rate, but also involved in standardization of insurance policies. This is one of main function of rating bureaus which make it easier for insurance companies to measure rate and contracts with market condition. (more…)