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community rating system

   Also found in: Acronyms 0.02 sec.
community rating system,
a program of health maintenance organizations (HMOs) that uses revenues and membership targets to determine health insurance premium rates. The HMO uses its own history in the calculation of rates, rather than any single employer's risk history. See also health maintenance organization.


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Insurance carriers use what is called a community rating system to determine base insurance rates in a particular zip code based on the number of collisions and claims that occur per annum within that zip code Even though Houston has a great many vehicle collisions, Pasadena, Texas auto insurance tends to be lower because Pasadena has a low incident history of vehicle collisions and claims
You also may qualify for a lower premium if your locality participates in NFIP's Community Rating System.
You may also want to ask your insurance agent about a Community Rating System (CRS) discount on your real estate property.
 
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