IPT05250 - Calculating the value of the premium: how the value of 鈥榓ny risk鈥� is determined

To determine the value of 鈥榓ny risk鈥�, the underwriter, using actuarial tables, other statistical information and their professional judgment, rates risks according to:

  • the amount for which the insurer is liable - usually expressed as the sum insured or a limit of liability;
  • the likely claims ratio (the possibility of loss occurring).