What Is a Base Rate?

The rate is the rate at which fees are paid. For example, the insurance industry rate refers to the ratio of the amount paid by the insurer to the insurer and the amount of compensation the insurer bears. Also refers to the charge that the phone charges in a billing unit.

Rate

Pure insurance rate: insurance amount

The insurer must implement the principle of equal rights and obligations when determining the rates. Specifically, the basic principles for determining the rates are adequate, fair, reasonable, stable and flexible, and the principle of promoting loss prevention.

1. Adequacy principle

Refers to the insurance premiums collected to cover the payment of insurance premiums and reasonable operating expenses, taxes, and the company's expected profits. The core of the adequacy principle is to ensure that the insurer has sufficient solvency.

2, the principle of fairness

Refers to the fact that premium income on the one hand must be commensurate with the expected payment; on the other hand, the premium paid by the insured should be consistent with its insurance rights. The age and gender of a person are symmetric, the insured with the same risk nature should bear the same premium rate, and the insured with different risk nature should bear a different premium rate.

3. The principle of rationality

It means that the insurance premium rate should be as reasonable as possible, and the insurer should not obtain excessive profits because the insurance premium rate is too high.

4. The principle of stability and flexibility

It means that the insurance premium rate should remain stable for a certain period of time to ensure the credibility of the insurance company; at the same time, it should also be adjusted with changes in risk, changes in insurance liability, and market demand, with certain flexibility.

5.Promote loss prevention principles

Refers to the establishment of insurance premium rates that will help the insured to strengthen disaster prevention and loss prevention, and reduce their rates for insureds who have done a good job in disaster prevention work; for the insured who has no damage or less loss, a preferential rate will be applied; and Insureds who have done poorly in disaster prevention and loss prevention will be subject to high rates or renewal premiums.