The various types of insurance other than life and health are called collectively property-casualty (PC) or property liability insurance. Property and liability insurance protects against fire, theft, liability, and other events that result in economic or non economic damage. Property insurance protects business and individuals form the impact of financial risks associated with the ownership of property, such as buildings, automobiles, and other assets. Casualty insurance projects policyholders from potential liabilities for harm to others as a result of product failure or accidents. PC insurance companies charge policyholders a premium that should reflect the probability of a payout to the insured and the potential magnitude.
Investment yield /return and risk
A common measure of the overall underwriting profitability of a line, which includes the loss, loss adjusted expenses, and expenses ratios, is the combined ratio. Technically, the combined ratio is equal to the loss ratio plus the ratios of loss adjustment expenses to premium written and commissions and other expenses to premium written. The combined ratio after dividends adds dividends paid to policyholders as a portion of premiums earned to the combined ratio. If the combined ratio is less than 100, premiums alone are sufficient to cover both losses and expenses to the line.
The loss ratio measures the actual losses incurred on a specific policy line. It measures the ratio of losses incurred to premium earned (premium received and earned on insurance contracts because time has passed without a claim being filed). Thus, a loss ratio of less than 100 means that premiums earned were sufficient to cover losses incurred on that line.
Investment yield /return and risk
A common measure of the overall underwriting profitability of a line, which includes the loss, loss adjusted expenses, and expenses ratios, is the combined ratio. Technically, the combined ratio is equal to the loss ratio plus the ratios of loss adjustment expenses to premium written and commissions and other expenses to premium written. The combined ratio after dividends adds dividends paid to policyholders as a portion of premiums earned to the combined ratio. If the combined ratio is less than 100, premiums alone are sufficient to cover both losses and expenses to the line.
The loss ratio measures the actual losses incurred on a specific policy line. It measures the ratio of losses incurred to premium earned (premium received and earned on insurance contracts because time has passed without a claim being filed). Thus, a loss ratio of less than 100 means that premiums earned were sufficient to cover losses incurred on that line.
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