References in periodicals archive
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Underwriting expense includes costs to acquire business, such as administration, advertising, marketing, taxes, licenses, fees, agent commissions, policy issuance costs; and costs to ensure that the acquired business is rated accurately, such as data, systems, and administration costs--that is, all costs except pure loss cost and LAE.
For instance, when some risk managers speak of costs, they mean pure loss costs, while others may refer to total premiums.
This deeper understanding covers not only pure loss costs and sales expenses but also supports underwriting, customer service and shared service costs such as information technology, human resources and finance that make up true product pricing.
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