What Does Judgment Rating Mean?
A judgement rating is an insurance rate that an underwriter assigns to a particular risk based on their subjective evaluation of that risk. Judgement ratings are frequently done on an individual basis and rely heavily on the experience, perception, and talent of the underwriter who makes the final evaluation.
Insuranceopedia Explains Judgment Rating
Judgement ratings are frequently used in auto insurance, where there can be a huge difference between the risks that each driver presents. The reason the risk can vary so much from driver to driver is that people have very different driving habits. While some people drive cautiously and defensively, others engage in riskier behavior behind the wheel.
In general, the higher the risk, the more expensive the judgement rating is. So, it usually pays to try to lower one's perceived risk wherever possible.