Research On The Model Of Engineering Insurance Ratemaking

Engineering insurance faces new opportunities and challenges, with the Government to expand construction of infrastructure. Engineering insurance ratemaking has plunged into chaos owing to snatching the market share between insurance companies. And to resolve that unreasonable phenomenon, this article intends to research a new model of engineering insurance ratemaking through combining Bill of Quantities and theory of engineering insurance ratemaking. Ratemaking will use the traditional method that is the Possible Maximum Loss (PML), and take it as the prototype, identify and evaluate the risk factors of Partial and sub-divisional works under the model of bill of quantities. Selecting risk matrix (WBS-RBS) as the method of risk identification, which is widely recognized and used, and a great advantage is to both combine bill of quantities and identify a larger number of risk factors clearly,and does not appear omission or confusion. The method of risk assessment used by AHP, which generate values is objectivity and accuracy. Cause quantifying the risk factors and calculating weight of each risk will be available unless all of judgment matrices must pass consistency test. Then it will be get the maximum possible loss values by calculating, and joined project cost together to come to adjustment factor of the model, which can be able to determined the engineering insurance rate eventually. Finally, the article uses an actual case to verify the proposed model to prove it is feasibility, and gives relevant suggestions for improvement base on the case. The structure of whole article is constructed on the steps of establishing the model, which attempts to establish a more scientific and reasonable and fairly model of engineering insurance ratemaking. It provides a new framework approach for our country engineering insurance ratemaking, and improves the development of engineering insurance market.