What does Sliding Scale Dividend mean? Read on to discover the definition & meaning of the term Sliding Scale Dividend - to help you better understand the language used in insurance policies.
Sliding Scale Dividend
A rating plan that pays a dividend to the insured on a loss sensitive basis. Dividends are not guaranteed and are paid based on the ratio the final audited premium bears to the total incurred losses of the insured for the specific policy period. Since losses stay open for several years after policy expiration, periodic dividend adjustments are made after the initial reconciliation.
We hope the you have a better understanding of the meaning of Sliding Scale Dividend.