What is Demographic Rating?
Demographic Rating allows an insurance carrier to set the premium for each employer group based on their own unique demographics.

What are Demographics?
Demographics of a group include the type of industry, age, gender of participants, contract types and in some cases location. Contract types = Single, Subscriber/Child, Husband/Wife, or Family.

How does the demographics of my group affect my rate?
A factor is applied to each of the demographics. For instance the Industry type, commonly referred to as an SIC (Standard Industry Code) factor could range from 0.925 to 1.075. The age and gender of your group can also have a dramatic affect on your rate.

Will my premium change if the demographics of our group change over the course of the year?
No, once your group receives and accepts a quote, the rates are guaranteed for that calendar year.

What is the Base Rate?
The Base Rate is the common starting point from which each group's unique set of demographics is applied.

How does the claims experience of my group impact my rates?
Although carriers compute base rates differently, actual claims experience of the pool of participants is always a factor. The pool of participants can include an entire block of business with a particular carrier or just the members of a specific association.

Generally speaking, how is my actual premium computed?
First the Base Rate is set. Then the census data for your group is inputted. This census data includes everyone in your office who is participating in the plan. The average age/gender and contract type factors are established and applied to the base rates. This final amount is your actual premium.

If you have any questions regarding demographic rating, contact USI Colburn today at 1-800-265-2876 or 610-833-1800.