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How is loss ratio determined?

Updated: 9/22/2023
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Q: How is loss ratio determined?
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How is loss ratio calculated?

Loss Ratio in insurance is the ratio of total losses paid out in claims plus adjustment expenses divided by the total earned premiums. If an insurance company, for example, pays out $60 in claims for every $100 in collected premiums, then its loss ratio is 60%.


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How is ratio calculated?

Loss Ratio in insurance is the ratio of total losses paid out in claims plus adjustment expenses divided by the total earned premiums. If an insurance company, for example, pays out $60 in claims for every $100 in collected premiums, then its loss ratio is 60%.


What is in a loss ratio?

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