Allocating Premium to Layer By the Use of Increased Limits Tables

Since the actuary is expected to know how to use increased limit factors, our literature should contain something on the practical aspects of this subject. It is the intent to provide herein, especially for the student or trainee, a primer on increased limits mathematics. The subject matter is not particularly difficult but is sometimes elusive. The reader is referred to J. T. Lange’s excellent paper, “The Interpretation of Liability Increased Limits Statistics,” in Volume LVI of the Proceedings for a thorough discussion of increased limits ratemaking and related technical problems.