loss ratio
- A numerical value that represents the relationship between the money an insurance company pays out for claims and the money it makes from premiums over a specific time period
- The loss ratio of the insurance company was high, showing they paid out more in claims than they received in premiums.
- A low loss ratio can indicate a profitable business as the company is receiving more in premiums than it's paying out on claims.
- Insurance companies use the loss ratio to assess their financial health and effectiveness in managing claims and premiums.
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