Principles and Practices in Connection with Classification Rating Systems for Liability Insurance as Applied to Private Passenger Automobile

Automobile registrations in the United States now exceed 67,000,000, an increase of 270% in the last three decades. The premium for bodily injury and property damage liability insurance has increased from $250 million to more than $3.0 billion during the same period. Passenger cars have accounted for their proportionate share in the phenomenal growth of the automobile industry and that type of vehicle has produced not less than $2.3 billion of the liability insurance premium. This multi-million dollar volume of business has been the incentive for the automobile liability insurance industry to exercise all of the techniques and knowledge at its command to effect an equitable and marketable distribution of risk by means of classification rating systems.