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🏢 '''Rating organization''' is an entity authorized under state [[Definition:Rating law | rating laws]] to collect [[Definition:Statistical data | statistical data]] from [[Definition:Insurance carrier | insurers]], develop [[Definition:Loss cost | loss costs]] or advisory [[Definition:Rate | rates]], and file them with [[Definition:State insurance regulator | regulators]] on behalf of the industry. While the term overlaps with [[Definition:Rating bureau | rating bureau]], "rating organization" is the broader legal designation used in most state insurance codes and can encompass advisory organizations, statistical agents, and full-service bureaus alike.

📋 These organizations aggregate [[Definition:Premium | premium]] and [[Definition:Claims data | claims]] information reported by member or subscriber companies, apply [[Definition:Actuarial science | actuarial]] techniques to derive indicated rate levels, and maintain the [[Definition:Classification code | classification systems]] and [[Definition:Statistical plan | statistical plans]] that ensure data consistency across the market. In [[Definition:Workers' compensation insurance | workers' compensation]], for example, the [[Definition:National Council on Compensation Insurance (NCCI) | NCCI]] functions as the licensed rating organization in most states, while the [[Definition:Insurance Services Office (ISO) | ISO]] fills that role across many property and [[Definition:Casualty insurance | casualty]] lines. Some states operate their own independent [[Definition:State rating bureau | state rating bureaus]] instead of — or in addition to — relying on national organizations. Carriers are generally required by law to report data to the designated rating organization, ensuring the statistical base remains robust.

🌐 The value a rating organization provides extends beyond number-crunching. By creating a shared data infrastructure, it lowers barriers to entry for smaller carriers that lack the scale to build standalone [[Definition:Ratemaking | ratemaking]] capabilities. It also gives regulators a consistent reference point against which to evaluate individual company [[Definition:Rate filing | rate filings]]. In an evolving landscape where [[Definition:Insurtech | insurtechs]] and [[Definition:Managing general agent (MGA) | MGAs]] seek rapid product launches, the forms, rules, and loss costs published by rating organizations often serve as the foundational building blocks around which new programs are constructed.

'''Related concepts'''
{{Div col|colwidth=20em}}
* [[Definition:Rating bureau]]
* [[Definition:Insurance Services Office (ISO)]]
* [[Definition:National Council on Compensation Insurance (NCCI)]]
* [[Definition:Advisory rate]]
* [[Definition:Statistical agent]]
* [[Definition:Rate filing]]
{{Div col end}}

Definition:Rating organization - Revision history

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