Calculator Inputs
Example Data Table
Use this sample to test quickly.
| Item | Exposure | Basis | Rate | Premium |
|---|---|---|---|---|
| General liability | 120,000 | 1,000 | 12.50 | 1,500.00 |
| Property | 80,000 | 1,000 | 18.00 | 1,440.00 |
| Cyber | 50,000 | 1,000 | 9.00 | 450.00 |
| Subtotal | 3,390.00 | |||
Suggested settings: experience 1.05, schedule -5%, deductible 0.95, fees 75. Policy minimum: 2,500. Tax: 3%.
Formula Used
Each line item premium is calculated as: Line Premium = (Exposure ÷ Basis) × Rate
Optional adjustments modify inputs before rating: ExposureAdj = Exposure × (1 + Inflation%), RateAdj = Rate × (1 + RateChange%)
Subtotal is multiplied by combined factors: AfterFactors = Subtotal × TermFactor × ExperienceMod × (1 + Schedule%) × (1 + Commission%) × (1 + UWLoad%) × DeductibleFactor × LimitFactor
Fees are added, and minimums are enforced by your selections: CompareBase = PremiumOnly or PremiumOnly + Fees, then max(CompareBase, PolicyMinimum).
Taxes and surcharges apply on the pre-tax total: Total = PreTaxTotal + PreTaxTotal×Tax% + PreTaxTotal×Surcharge%.
How to Use This Calculator
- Add line items with exposure, basis, rate, and item minimum.
- Set modifiers, loads, and optional deductible or limit factors.
- Choose term months and enable proration if needed.
- Pick minimum rules and how the comparison is applied.
- Enter taxes, surcharges, and optional premium cap.
- Select a payment plan and any installment fees.
- Press Calculate to see totals, charts, and schedules.
Minimum premium purpose in rating
Minimum premiums protect carriers from fixed servicing costs when exposure is small. They stabilize acquisition, underwriting, and claims handling expenses that do not scale linearly with payroll, sales, or values. This calculator shows when your calculated premium falls below the contractual threshold and quantifies the uplift clearly. It also separates fees, taxes, and surcharges so stakeholders understand the driver of the minimum.
Line item structure and basis control
Many programs price coverages by exposure per unit basis, such as per 100 or per 1,000. Using basis alongside rate prevents accidental unit errors and improves comparability across coverages. Per-item minimums can be applied to keep individual coverages above their floor before policy minimum logic runs. Mixed bases across coverages are supported, which mirrors underwriting worksheets and manuals.
Modifiers, loads, and sensitivity testing
Experience modifiers, schedule credits, commissions, and underwriting loads are modeled as multiplicative factors. Deductible and limit factors extend this approach for common adjustments. The what-if rate change and inflation guard options support scenario planning, letting analysts stress premium outcomes under portfolio re-rating or valuation drift. Because factors compound, the build-up chart helps validate order-of-operations and prevents misinterpretation during negotiation.
Term proration and earned premium view
Short-term policies often require proration to reflect reduced time at risk. When enabled, premium, minimums, and fixed fees scale with the term factor. The minimum earned premium view complements cancellation discussions by comparing pro-rata earned premium to an agreed minimum earned percentage, producing a transparent earned floor estimate. This supports messaging between underwriting, billing, and insured parties when midterm changes occur.
Compliance, payments, and reporting outputs
Tax and surcharge fields help model jurisdictional add-ons on the selected base. Optional premium caps provide guardrails for negotiated programs. The payment plan schedule converts the final premium into installments with fees, supporting billing conversations. CSV and PDF exports preserve assumptions, results tables, and charts for audit-ready documentation. Keeping inputs and outputs together reduces reconciliation time and improves governance across renewals and endorsements.
FAQs
What is a minimum premium?
A minimum premium is the lowest charge a policy will accept, regardless of calculated exposure-based premium. It helps cover fixed underwriting, policy issuance, and servicing costs when exposures are small.
Should minimum apply before or after taxes?
It depends on policy wording and jurisdiction. Many programs enforce minimum on pre-tax premium plus fees, then apply taxes. Some compare minimum to the final billed total. Use the option that matches your contract.
Why include basis with the rate?
Rates are often quoted per 100, 1,000, or 10,000 units of exposure. Basis prevents unit mistakes and lets you combine coverages that use different rating units in a single calculation.
How do per-item minimums differ from policy minimums?
Per-item minimums enforce a floor on each coverage line before policy-level minimum logic runs. A policy minimum enforces a floor on the overall premium (or premium plus fees), after factors and fees are applied.
How should I use the inflation guard and rate change?
Inflation guard increases exposures by a percentage to reflect valuation drift. Rate change adjusts all line rates to test re-rating scenarios. Together they help you evaluate renewal impacts and sensitivity to assumption changes.
Are the payment plan numbers accounting-grade?
The schedule is a planning estimate based on the final total, a down payment percentage, and installment fees. Real billing may include rounding rules, due dates, and regulatory requirements, so confirm with your billing system.