Which of the following statements about schedule rating is (are)true?
I.It involves the determination of a basis rate for each exposure,which is then modified by credits or debits.
II.It is based on the assumption that certain physical characteristics of the insured's operations will influence the insured's future loss experience.
A)I only
B)II only
C)both I and II
D)neither I nor II

Question

Quizplus · Accepted Answer

Schedule rating is a method of adjusting an insurance premium by assigning a credit or debit based on specific characteristics of the risk being insured. This process involves the determination of a basis rate for each exposure, which is then modified by credits or debits. Additionally, it is based on the assumption that certain physical characteristics of the insured's operations will influence the insured's future loss experience. Therefore, both statements I and II are true.

Which of the Following Statements About Schedule Rating Is (Are)true