Is the expense constant included in Standard Premium?
The expense constant is not included in Standard Premium in the premium calculation at policy issuance or for statistical reporting. However, the expense constant is included in standard premium for aggregate financial reporting. Refer to Part II Aggregate Financial Reporting, Section 3, Definitions. Refer to Rule VII C. 1. in the MA Manual. For more details on the expense constant, refer to Rule VI E. in the MA Manual and to the Massachusetts Voluntary Market Premium Algorithm, Appendix E, or the Residual Market Premium Algorithm, Appendix F.
