GI 101: On-level premium and prospective losses need a common period
A ratemaking exercise compares future costs with premium on a defined basis. Development, trend and on-levelling each address a different mismatch. Label the experience and prospective periods before calculating.
Original practice scenario
Use original premium 1m and ultimate historical losses .7m. Adjust premium for a stated rate-level change and losses for a stated future trend, separately. Explain why changing only premium or only losses would leave the comparison inconsistent.
Study check
Write the assumptions, the decision being supported and one limitation. Use the current course syllabus for the required terminology and scope; this introductory guide is not a complete course summary.
Reading sources
ActNet editorial guide · October 1, 2026 · Original illustrative examples.
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