policy-year basis

  • A method of compiling experience on policies issued during a given calendar year. The experience of a given policy year—1991, for example—is a complete record of all transactions on policies issued effective during the 12 months of the calendar year 1991. Because annual policies issued between January 1 and December 31 of any year expire between January 1 and December 31 of the following year, and annual policy issued in any given policy year will extend over a portion of two calendar years. See Losses incurred—policy year basis.

    Internal Revenue Service 1
    See also experience

1Internal Revenue Service, Internal Revenue Manual 4.42.6 Glossary, http://­www.irs.gov/­irm/­part4/­irm_04-042-006.html (last accessed Dec. 22, 2009).