SECTION VI RATING PROCEDURE
1. Actual Primary Losses
Actual Primary Losses (Ap), as tabulated in accordance with the provisions of Rules 4 and 5 of Section V, shall be used in the rating.
2. Expected Losses
Expected Losses (E) shall be determined from the application of the appropriate Expected Loss Factor, shown in Table A, to the payrolls or other exposures for each classification for the experience period.
3. Credibility
The Credibility (C) of the experience of the risk shall correspond to Expected Losses (E), as shown in Table B.
4. Limit Charge
A limit charge (L) reflecting the loss dollars eliminated by the split point placed on One Accident, shall be included in calculating the modification. The Charge times Credibility, or L x C, shall be determined by entering Table B at the level of Expected Losses for the experience period.
5. Credibility Complement (1-C)
The Credibility Complement is computed by subtracting the Credibility (C) from unity (1.0).
6. Experience Modification
[Ap x C + E x C x L + E(1.0 – C)] / E
1.10 + 0.0004 x (E / G), where G=10