The insurance agents at Risk & Insurance Consultants feel it is their job to provide you with the necessary knowledge to become a smarter consumer of business insurance in Atlanta. Right now, we will focus on rates and credits, which are a few insurance key terms.

While conversing with your agent, you are bound to hear the word “rate(s)” be bounced around. A rate is a unit of cost that is multiplied by exposure base to determine an insurance premium. In layman’s terms, an insurance rate is the amount of money needed to cover losses and expenses and provide a profit to the insurer for a single unit of exposure.

Insurance rates are measured by variables such as payroll, square footage, sales, receipts or units. Added into this rate are the insured’s inherent risk and loss history. Frequent or severe losses can be a red flag for poor risk management or loss control practices of the insured. In situations of the sort, rates will undoubtedly be higher.

A credit, on the other hand, is a discount applied to standard rates after loss experience is factored. These are available for providing loss control, safety and other risk management programs to employees. Discount credits may also be applied for good loss experience or high volume premium.

It is important to take advantage of all the credits you have available. By telling your agent about your business’s operations and loss history, you can ensure that you do so.

Keep this in mind the next time you talk to your agent and be an informed consumer. For more information, visit

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