I'm not understanding the idea and purpose of 'off balance' in the rate revision process. I'm a product analyst, as opposed to an actuary, so I'm not involved in indications, but I'm involved in the "off balance" process.
suppose, I have on-level premium of $100, with an indication of +5%. why do I need to 'off balance'? I understand the it has something to do with getting an off balance factor to get rate-neutral, but I still don't know what that means.
why do we have to get it neutral?
apologize if my example does not contain enough info. feel free to add more arbitrary data.
suppose, I have on-level premium of $100, with an indication of +5%. why do I need to 'off balance'? I understand the it has something to do with getting an off balance factor to get rate-neutral, but I still don't know what that means.
why do we have to get it neutral?
apologize if my example does not contain enough info. feel free to add more arbitrary data.
not understanding 'off balance'