Scenario D
This scenario explains premium calculation for a policy within a group account and having a contract period.
Policy 2343
[width="100%",cols="20,80",] |===
| Policy Co | POL2343
| Group Account | ORCL CORP with start date 1-Jun-2014
| Contract Period | 1-Jun-2014 - 31-May-2015
Contract Reference Date: 1-Jun-2014
Collection Frequency: 12 [1]
| Member | P. Johnson
Date of Birth: 9-Dec-1985
Region Code: AH
| Enrollment Product | GOLD PLAN with start date 01-Jan-2015 and end date 15-Apr-2015
Add-on: -
The system selects the calculation periods as mentioned in the image below. image::identify-periods-scenario-d.png[Identify Periods Scenario D] Here, even though the advance collection setting is 12 Months, the periods beyond May'15 are not selected. This is because the contract period ends in the May'15 calculation period. Since the policy enrollment started on 1-Jan-2015 (so Jan'15 is in fact the first calculation period for this policy), there are no past periods that require recalculation. This results in the removal of the past calculation periods from the to be considered list of calculation periods. So only periods from Jan'15 to May'15 are considered for calculations. == Calculations for GOLD PLAN Jan'15 The image below specifies the configuration that is applicable for the calculation period Jan'15 image::configuration-settings-scenario-d-jan-gold-plan.png[Configuration Settings Scenario D Jan GOLD PLan] === Enrollment Product Premium The enrollment product premium is based on the person’s age. In this example the person’s age is 28 years, therefore the applicable premium value is 1400.00. This is the value for a calendar year. The system considers 1400.00 as the applicable value for a period of 365 days starting from the first day of the contract period. The calendar period is considered to be of 365 days because the calendar year (2014) of the reference date has 365 days. This amount distribution setting on the enrollment product is Evenly. Thus, the premium value for the calculation period is Daily Amount * # Full Calculation Period Days / # Full Calculation Periods. Daily Amount is given by configured value divided by the number of days in the calendar year of the reference date. '# Full Calculation Period Days' is the total number of enrolled days over the calculation periods in which the policy enrollment is full. So, '# Full Calculation Period Days' is 31+28+31 = 90. '# Full Calculation Periods' is the number of calculation periods in which the policy enrollment is full, so '# Full Calculation Periods' is 3. image::days-in-calculations.png[Days in Calcuiation] Premium Amount = 1400.00/365 (90/3) =115.07 === Surcharges Regional Tax surcharge of 3.25% is applied. Surcharge Amount = (1400.00*0.0325)/365 *(90/3) = 3.74 Thus, the surcharge amount of 3.74 is charged. === Adjustments Two adjustments - Office Visit Co-payment Discount and Payment Frequency Discount are configured for enrollment product GOLD PLAN in group account ORCL CORP. These adjustments have an adjustment sequence as 1 & 2 respectively. This implies that Office Visit Co-payment Discount is evaluated first. The Payment Frequency Discount (if applicable) is applied on the adjusted value that results after reducing the premium by Office Visit Co-payment Discount. The Office Visit Co-payment Discount is based on OV Copay parameter based schedule dimension. An OV Co-pay parameter value of 30 is defined on the policy enrollment product in this scenario. Thus the adjustment rule with the dimension value 30 gets selected. An override value of -6% is present for this adjustment rule at the group account level, therefore, the system applies an adjustment of -6%. Office Visit Co-payment Discount adjustment = -6 % Adjustment Amount = (1400-0.06)/365*(90/3) = -6.90 Payment Frequency Discount is based on the advance collection setting on the policy. The adjustment rules that get selected for evaluation are [width="50%",cols=",,",options="header"] |
==== |
Payment Frequency |
Discount |
Type |
6 |
-1 |
Percentage |
12 |
-1.5 |
Percentage |
==== By using the dynamic logic condition the rule with the dimension value of 12 gets selected and the adjustment value of -1.5%, gets applied. Payment Frequency Discount adjustment = -1.5% Adjustment Amount = ((1400-84)-0.015)/365(90/3) = -1.62 === Surcharge - After Adjustment The post adjustment Administrative Surcharge of 1.5% applies on the value given by base premium plus adjustments. The post adjustment Administrative Surcharge = ((1400-84-19.74)0.015)/365(90/3) = 1.60 === Calculation Result Lines for Jan'15 [width="100%",cols="25,25,25,25,25,25,25,25",options="header",] |
==== |
Start Date |
End Date |
Input Amount |
% |
Prorate Factor |
Result Amount |
Schedule Definition |
Premium Schedule |
1-Jan-2015 |
31-Jan-2015 |
- |
- |
- |
115.07 |
Age Gender Premium |
Gold Plan |
1-Jan-2015 |
31-Jan-2015 |
1400.00 |
3.25 |
- |
3.74 |
Regional Tax |
1-Jan-2015 |
31-Jan-2015 |
1400.00 |
-6 |
- |
-6.90 |
Office Visit Co-payment Discount |
1-Jan-2015 |
31-Jan-2015 |
1316.00 |
-1.5 |
- |
-1.62 |
Payment Frequency Discount |
1-Jan-2015 |
31-Jan-2015 |
1296.26 |
1.5 |
- |
1.60 |
Admin. Surcharge |
==== Calculation Results for Jan'15 [width="100%",cols="25,25,25,25,25,25",options="header",] |
==== |
Policy |
Calculation Period |
Total Base Premium |
Total Adjustment |
Total Surcharge |
Total Result |
POL0002343 |
1-Jan-2015 |
115.07 |
-8.52 |
5.34 |
111.89 |
==== These calculations also hold true for the calculation period of Feb'15 and Mar'15. == Calculation for GOLD PLAN April'15 === Enrollment product premium The calculation period of April'15 is the last CP of the contracted period for enrollment product premium. The system, therefore, performs reconciliation calculation in this calculation period for premium. The amount charged for April'15 is Daily Amount * # Contracted Enrolled Days - Charged Value Daily Amount * # Contracted Enrolled Days = 1400.00/365 (105) Charged Value = 115.07+115.07+115.07 = 345.21 Premium for April'15 =1400.00/365 *(105) - 345.21 = 57.53 === Surcharges Regional Tax surcharge of 3.25% is applied. Charged Value = 3.74+3.74+3.74 = 11.22 Regional Surcharge for April'15 = (1400.00*0.0325)/365(105) - 11.22 = 1.87 === Adjustments Office Visit Co-payment Discount adjustment of -6% is applied. Charged value = (-6.90)(-6.90)(-6.90) = -20.7 Office Visit Co-payment Discount adjustment = (1400*-0.06)/365*(105) - (-20.7) = -3.46 Payment Frequency Discount adjustment of -1.5% is applied. Charged Value = (-1.62)(-1.62)(-1.62) = -4.86 Payment Frequency Discount adjustment = ((1400-84)-0.015)/365(105) - (-4.86) = -0.82 === Surcharge - After Adjustment Post adjustment administrative surcharge of 1.5% is applied. Charged Value = 1.60+1.60+1.60 = 4.80 Administrative Surcharge = ((1400-84-19.74)0.015)/365(105) - 4.80 = 0.79 Calculation Result Lines for April'15 [width="100%",cols="25,25,25,25,25,25,25,25",options="header",] |
==== |
Start Date |
End Date |
Input Amount |
% |
Prorate Factor |
Result Amount |
Schedule Definition |
Premium Schedule |
1-Apr-2015 |
15-Apr-2015 |
- |
- |
- |
57.53 |
Age Gender Premium |
Gold Plan |
1-Apr-2015 |
15-Apr-2015 |
1400.00 |
3.5 |
- |
1.87 |
Regional Tax |
1-Apr-2015 |
15-Apr-2015 |
1400.00 |
-6 |
- |
-3.46 |
Office Visit Co-payment Discount |
1-Apr-2015 |
15-Apr-2015 |
1316.00 |
-1.5 |
- |
-0.82 |
Payment Frequency Discount |
1-Apr-2015 |
15-Apr-2015 |
1296.26 |
1.5 |
- |
0.79 |
Admin. Surcharge |
==== Calculation Results for April'15 [width="100%",cols="25,25,25,25,25,25",options="header",] |
==== |
Policy |
Calculation Period |
Total Base Premium |
Total Adjustment |
Total Surcharge |
Total Result |
POL0002343 |
1-Apr-2015 |
57.53 |
-4.28 |
2.66 |
55.91 |
==== |