Basic Ratemaking Version 5 May 2016 2

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Casualty Actuarial Society, 2016 Basic Ratemaking Fifth Edition, May 2016 Geoff Werner, FCAS, MAAA Claudine Modlin, FCAS, MAAA Willis Towers Watson With significant contributions from: Alice Gannon, FCAS, MAAA; Serhat Guven, FCAS, MAAA; Christine Gennett, ACAS, MAAA; Jeff Kucera, FCAS, MAAA; Brett Nunes, ASA, MAAA; and Dave Otto, FCAS, MAAA i Basic Ratemaking Geoff Werner, FCAS, MAAA and Claudine Modlin, FCAS, MAAA Willis Towers Watson This text outlines Basic property/casualty insurance Ratemaking concepts and techniques. It is intended to be a single educational text to prepare actuarial candidates practicing around the world for Basic Ratemaking .

ii FOREWORD Ratemaking is a key driver of property and casualty (P&C) insurance profitability and hence a primary actuarial responsibility. Actuaries employ a variety of ratemaking techniques depending on specific

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