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Incurred Claims Ratio (FP8478)

Percentage of gross incurred claims during the reporting period relative to the gross earned premium during the same reporting period.
Calculation:
Reporting format
Decimal
Metric type
Flow
Metric level
Product/Service, Organization
IRIS metric citation
IRIS, 2016. Incurred Claims Ratio (FP8478). v4.0.

Footnote

Organizations should footnote all assumptions used.

Usage Guidance

  • The metric can be used to interpret the value of products to the insured. As an example, a 70 percent incurred claims ratio means that for every $100 of premium earned in a given accounting period, $70 is paid back in the form of benefits (claims).
  • Organizations should note that incurred claims ratios cannot be compared across different product types or at different stages of a product's life cycle.
  • For more detail on the ratio and for guidance on interpretation, see the Microinsurance Network's Social Performance Indicators for Microinsurance, p. 16 (http://www.microfact.org/social-performance/).