Basis of Premium Charges
Depending on the jurisdiction, the insurance premium can be either mandated by the government or determined by the insurance company, in accordance with a framework of regulations set by the government. Often, the insurer will have more freedom to set the price on physical damage coverages than on mandatory liability coverages.
When the premium is not mandated by the government, it is usually derived from the calculations of an actuary, based on statistical data. The premium can vary depending on many factors that are believed to have an impact on the expected cost of future claims. Those factors can include the car characteristics, the coverage selected (deductible, limit, covered perils), the profile of the driver (age, gender, driving history) and the usage of the car (commute to work or not, predicted annual distance driven).
Read more about this topic: Vehicle Insurance
Famous quotes containing the words basis of, basis, premium and/or charges:
“Painting dissolves the forms at its command, or tends to; it melts them into color. Drawing, on the other hand, goes about resolving forms, giving edge and essence to things. To see shapes clearly, one outlines them—whether on paper or in the mind. Therefore, Michelangelo, a profoundly cultivated man, called drawing the basis of all knowledge whatsoever.”
—Alexander Eliot (b. 1919)
“It was the custom
For his rage against chaos
To abate on the way to church,
In regulations of his spirit.
How good life is, on the basis of propriety,
To be followed by a platter of capon!”
—Wallace Stevens (1879–1955)
“There is little premium in poetry in a world that thinks of Pound and Whitman as a weight and a sampler, not an Ezra, a Walt, a thing of beauty, a joy forever.”
—Anna Quindlen (b. 1952)
“I have never injured anybody with a mordant poem; my
verse contains charges against nobody. Ingenuous, I have
shunned wit steeped in venom—not a letter of mine is dipped
in poisonous jest.”
—Ovid (Publius Ovidius Naso)