Judgment Rating
What Does Judgment Rating Mean?
A judgment rating is an insurance rate assigned to a particular risk by an underwriter based on their subjective evaluation of that risk. Judgment ratings are typically applied on an individual basis and depend heavily on the underwriter’s experience, perception, and expertise in making the final assessment.
Insuranceopedia Explains Judgment Rating
Judgment ratings are commonly used in auto insurance, where the risks presented by individual drivers can vary significantly. This variation in risk arises from differences in driving habits—while some drivers are cautious and defensive, others engage in riskier behavior behind the wheel.
In general, the higher the perceived risk, the more expensive the judgment rating. Therefore, it is often beneficial for drivers to take steps to lower their perceived risk whenever possible.
