Ace the OTL Challenge 2025 – Unlock Your Insurance Success Story!

Increased insurance premiums are often associated with high claim frequency due to several reasons. When an individual or entity has a history of frequently filing claims, insurance companies perceive them as a higher risk. This higher risk is based on the principle that more frequent claims suggest that the insured party may be more likely to incur future losses. Consequently, insurers will adjust premiums upward to compensate for this increased likelihood of having to pay out claims.

Insurance rates are designed to reflect the risk that the insurer is underwriting, and high claim frequency indicates a pattern that could lead to more payouts. As a result, insurers reassess the premiums based on the historical data of claims, which can lead to increased costs for the policyholder. This adjustment helps maintain the insurer's financial stability and ensures they can cover potential future claims effectively.