Pricing benefits with shared limit

lundi 24 novembre 2014

e.g Figures are arbitrary



Benefit A = 500 Deductible = 30% of cost

Benefit B = 100 deductible = 70% of cost



Both with shared maximum limit of 1000



Benefit A priced separately to limit of 1000 = 0.8 Factor

Benefit B priced separately to limit of 1000 = 0.9 Factor



Apart from simulation, is there an approximate way to estimate the Price of A and B subject to the shared limit



If the factor for a limit of 1000 = 0.75, would it be prudent to price Benefit A as



30%*0.75*.8?





Pricing benefits with shared limit

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