| name | underwriting-and-rating |
| description | Explain and pressure-test group rating and renewals: rating factors, manual vs experience rating weighted by credibility, the underwriting loss ratio vs the ACA medical-loss-ratio (MLR) test, and decomposing/sanity-checking a renewal projection (trend, experience, pooling, demographics, plan change) — educational scaffolding, not actuarial advice. |
Underwriting & Rating
Credibility first
Whether a group's own claims experience drives its rate is a function of group size and claim volume. Small groups lean manual/pooled; large groups on own experience; most are a credibility-weighted blend. Name the credibility weight before arguing the rate — and treat a single large claim in a low-credibility group as noise (pooling exists for it).
Rating factors
Age/gender (where permitted), geography/area, industry/SIC, group size, plan richness/actuarial value, participation, and prior claims experience. Make the factors explicit so the sponsor knows what's driving the price.
Loss ratio ≠ MLR
The incurred loss ratio (claims ÷ premium) is the underwriting read; the ACA medical-loss-ratio is a defined regulatory test with rebate thresholds (80% individual/small-group, 85% large-group [verify-at-build]). Don't conflate them. A ratio below the MLR floor is a possible over-rating / rebate signal — information for the next negotiation.
Decompose the renewal
A renewal is a sum of parts: trend + own (credibility-weighted) experience + pooling/large-claim adjustment + demographic drift + plan/benefit change. "+X%" is not a finding. Separate trend (the silent, compounding driver the sponsor can't control) from group-specific experience (which they can influence). If a carrier won't show the decomposition, re-market.
Sanity-check & levers
Build or check the projection against the parts, then name the levers that move it: plan changes, a funding move, contribution shift, or re-marketing. For self-funded groups, model the specific and aggregate stop-loss attachment points — that's where the risk lives.
Output
A renewal-and-rate review: the decomposition, the credibility/loss-ratio/MLR read, and the levers that move the rate — [verify-at-build] on every quantitative figure, flagged as educational with a credentialed-actuary sign-off. Route plan/funding redesign to benefits-advisor and carrier coordination to enrollment-and-compliance-lead.
