As respects workers compensation, the method in which the actual loss experience
of the insured is compared to the loss experience that is normally expected
by other risks in the insured's rating class. The resulting experience modification
factor is then applied to the premium of the insured. In other casualty lines,
the actual loss experience of the insured is generally compared to the actual
loss experience of risks in the same industry to again develop a modifying factor
for application to the insured's premium.
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