Inflation in premiums
- Tags:
- Business Operations,
- Corporate Insurance,
- Currency & Foreign Exchange,
- Finance,
- Inflation,
- Insurance,
- Loss Ratio,
- Premium
- Source:
- Business Week Online
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Overview: Premiums for what the institute calls "multiple-peril" coverage -- hurricanes, tornados and other weather-related disasters -- increased an average of 6.25% a year over the same period, the report says. To understand why premiums increase, it's important to understand an insurer's reliance on its loss ratio. Loss ratio is the percentage of premiums that an insurer pays out in claims. Larger claims over the past several years have been a major reason for higher premiums, the institute says. In the next topic, we look at how higher claims are also making it harder for some homeowners to buy an affordable policy.
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Format: HTML | Date: Sep 2003 | Pages: 1
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