What is the definition of Preferred Risk Class?
A Preferred Risk Class is a group of people that show a significantly lower risk of loss.
They are called a preferred risk class because the likelihood that a loss will happen in a group within a period of time is considerably lower when compared to another group covering the same time period. This risk is related to mortality (the likelihood of death) and morbidity (the likelihood of sickness and illness to occur in a given population).
In general, persons belonging to these groups exhibit excellent health habits, family medical histories, belong to "safe" occupations and are generally in great physical condition. Members of this group also do not smoke.
People belonging to a preferred risk class usually are charged with lower premiums.
| Not a bit | Very useful |
- Premises
- Premium
- Premium Reduction Option
- Premium Tax
- Premiums in Force
- Premiums Written
- Primary Beneficiary
- Primary Company
- Primary Market
- Prime Rate
- Preferred Provider Organization
- Pre-Existing Condition
- Pool
- Pollution Insurance
- Political Risk Insurance
- Policyholders’ Surplus
- Policy Dividend Options
- Policy
- Point-of-Service Plan
- Personal Lines