: Rates should not fluctuate wildly between policy periods, as this can alienate customers and disrupt the market. Key Components of a Premium
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The fundamental principle of ratemaking is that premiums should be (not too low), not excessive (not too high), and not unfairly discriminatory (similar risks pay similar premiums). not excessive (not too high)
Actuaries must estimate two main types of liabilities: : Rates should not fluctuate wildly between policy