- Single Premium Basis
This is where every member of the group life scheme is charged premium based on his attained age which is considered sufficient to meet the mortality risk for the year under consideration. Single premium basis may is normally referred to as Current Cost Basis.
- Average Premium Rate Basis
This type of rating is where an average premium rate is determined for all the members of the group life scheme based on the average age of the scheme and then applied to each member irrespective of their actual age. It is only applicable when the membership size of a group life scheme is large.
- Unit Cost Premium Basis
The premium rate is applied as a constant percentage on the sum assured say per member of the group life scheme and it is usually guaranteed for a fixed number of years say for 5 years before being reviewed. Depending on the claims ratio, the premium rate may go up or remains constant at the time of review.
