Insurance loss ratios

Insurance loss ratios are another group of measures closely related to EMR. These ratios include loss ratio, expense ratio, and combined ratio. Insurance loss ratios can b e a valid measurement of safety quality. Although not as widely used for benchmarking as OSHA rates and EMR, these ratios are important to understanding insurance, which is a financial motivator in the field of safety. Insurance losses can be defined as the following ... 

Insurance Loss Ratios loss ratio, expense ratio, and combined ratio. 

Injury rates Health statistics Direct costs Illness rates Investment return Insurance loss ratios Severity rates... 

Loss ratio—A fraction calculated by dividing losses of an organization and the amount of insurance premiums paid. 

Loss Ratio The loss ratio is a formula used by insurers to relate loss expenses to income. Formula (incurred losses + loss adjustment expenses) -s- earned premiums. 

Expected loss ratio A formula used by insurance companies to relate expected income to expected losses. The formula for the expected loss ratio is (expected incurred losses + expected loss adjusting expense) expected earned premiums. 

The expense ratio plus the loss ratio equals the combined ratio. Although insurers use several different ratios to calculate costs, the combined loss ratio is the simplest. The nationwide average for the combined ratio is approximately 1.07 on all types of business property-casualty insurance, which includes WC, fire, and related policies. Thus, for every 1 taken in, insurance carriers pay out 1.07 (Taggart and Carter 1999). If a firm s combined ratio (a combination of insurer s expenses and a firm s losses) is below 1.00, it is considered a profitable account. If the ratio is 0.50, it is a very profitable account. This can be used as a bargaining chip with the insurer. However, if the firm s combined ratio exceeds 1.00, this may be a forewarning of cancellation or a rate hike. 

The insurance loss experience for an organization is closely related to its safety performance. An understanding of how insurance premiums are calculated and the type of impact accidents can have upon premiums can provide the safety manager with an additional method for measuring safety performance. Along with measures of lost workdays and recordable accidents, insurance industry measures should also be part of the safety performance measurement and improvement process. Examples of quantifiable insurance markers that are indicative of safety performance are loss ratios, experience modification rates, and expense ratios. These insurance industry measures are yet another type of performance measure available to the safety professional. 

The expense ratio plus the loss ratio equals the combined ratio. The combined ratio indicates the amount taken in by an insurance company versus the amount paid out. 

From the loss history and the policy premiums the loss ratio is derived. The loss ratio is the most important single factor in determining a firm s desirability to an insurer. It equals the premium paid for a given year, divided by the claims paid during that year. Loss ratios of less than one represent a net loss to the carrier and render coverage extremely difficult to obtain. Ideally, a museum will bid out its business once every three years, to assure a competitive price. To do this, it submits a summary of the coverage it wishes to obtain to one or more agents for circulation to interested underwriters. This list should include ... 

In New South Wales, the State in which the Snowy Scheme was constructed, the level of premiums for accident insurance on construction operations is fixed every three years by the Government. Obviously under this system (known as the fixed loss ratio scheme ) there is no direct monetary incentive for a contractor to reduce his accident rate. 

Provided that any bonus payable shall not be less than the statutory minimum fixed by the Premiums Committee in accordance with the New South Wales Workers Compensation Fixed Insurance Premium Rates and Fixed Loss Ratio Scheme 1945 as amended from time to time. 

This information is used to forecast or predict future losses. This experience rating uses cost predictions and incentives for loss prevention combined with sound insurance and statistical principles. Providing accurate information is extremely important. If the information you provide is not accurate, it may be viewed as fraud, and may skew your future loss ratios, increasing insurance premiums. 

Materials. The materials are described in detail in the studies summarized in Table I. Most of these results are based on kraft lignin. The NCO/OH ratio of all of these networks were high greater than 1.5. All of the networks were prepared from homogeneous solutions of the lignin-based polyol, added (soft segment) polyol, and diisocyanate. Films were cast and cured under mild conditions with a controlled loss of solvent. The films were post-cured to insure complete reaction (25). 

Knowledge as to a contractor s performance can be provided by their insurance company. They calculate an experience modification rate (EMR) for the previous 3 years. It is the ratio of the Actual Workers Compensation Losses to the Expected Workers Compensation Losses. ... 

Expense Ratios for insurance claims can be measured as the expense versus the total dollar loss for the claim (Bok and Shields 2001). The expenses are costs to the insured in excess of the losses. Insurers must pay expenses such as special services like attorneys fees, rental fees, supplies, and taxes all of which form a cost of doing business (Bickelhaupt 1983,66). 

The ratios alone do not show the whole picture, so it is important to view the underlying dollar amounts. An increase in expense ratios does not necessarily indicate an increase in expense dollars (Bok and Shields 2001). An increasing expense ratio could just as easily result from a decrease in net written premiums provided that expenses are not decreasing at a quicker pace (Bok and Shields 2001). The first expense is what it costs to write insurance-expenses incurred or expense ratio (Bok and Shields 2001). This category includes employee salaries, agent commissions, overhead costs, company cars and other expenses incurred just to open the doors and provide a service. This amount also includes loss adjustment expenses. 

The U back-extraction study came to the conclusion that low chloral-base salts offer the most suitable results. However, a perfect tightness of the system must be insured to prevent AICI3 losses. The use of be CaCl2-LiCl (70 to 30 mol%) and an AlCl3/An ratio equal to six to seven led to a nearly quantitative back-extraction of U (the most difficult actinide to be recovered). 

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