Rating premium reports
When PolicyCenter processes a premium report,
it is essentially collecting data and calculating premiums for only a
portion of the policy period. The premium report job has non-null values
for its properties AuditPeriodStartDate
and AuditPeriodEndDate.
When rating the premium report, the rating logic calculates costs only
for amounts overlapping with the audit period.
You can see examples of this in the built-in
workers’ compensation rating. The default rating code determines the
overlap between each employee (WCCoveredEmployee)
and the audit period. Next, it prorates the basis by the formula in the
following pseudo-code.
(number of days of overlap)/(number of days in WCCoveredEmployee effective period)Rating logic does not create costs whose effective dates fall outside the audit period. For example, suppose the policy period is from January 1, 2019 to January 1, 2020 and the audit period is for February 1, 2019 through March 1, 2019. Rating must not return any costs that are effective prior to February 1, 2019 or which expire later than March 1, 2019. To prevent mistakes, PolicyCenter detects this condition and throws an exception for any rule violations.
The cost and cost data property SubjectToReporting controls what
happens to the rating and billing of certain types of costs for policies
subject to reporting. The property is important if you implement rating
for premium reports.
During premium reporting rating calculations, you might want to omit some items from calculations, or handle them differently during rating. For example, the following behaviors are employed when handling the workers’ compensation rating line.
- The expense constant is meaningful only for the period as a whole, not for any single monthly or quarterly report.
- Taxes are billed up front and at final audit. However, premium reports omit them.
- Rating can determine the premium discount percentage only by looking at the total premium for the entire period. PolicyCenter estimates this at submission or renewal time and determines a discount percentage. During premium reports, the system uses the percentage determined previously. It does not calculate a new discount percentage. This is because the premium report does not calculate a full period premium so it would have no way of deciding which discount percentage is appropriate. At final audit, PolicyCenter calculates the correct final discount and uses it to determine final audited premium.