What department is responsible for computing the premium to be charged for insurance?

The Actuarial and Statistical Department is responsible for computing the premium to be charged for insurance because it utilizes mathematical and statistical methods to assess risk and determine the pricing structures for various insurance products. This department analyzes vast amounts of data related to the frequency and severity of claims, which enables them to predict future risks associated with different policies.

Actuaries within this department play a crucial role in developing the formulas and models that assess potential losses and set appropriate premium rates to ensure the insurance company remains financially stable while also providing competitive pricing to policyholders. Through their expertise, they help ensure that the premiums reflect the risk accurately, allowing the insurer to adequately cover future claims while remaining profitable.

Other departments, such as Underwriting, may use the premiums set by the Actuarial and Statistical Department to make informed decisions about which policies to approve or deny based on risk assessment. In contrast, the Claims Department focuses on managing and settling claims, while the Customer Service Department handles inquiries and support needed by policyholders, making them less involved in the actual premium-setting process.