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Foundations of Casualty Actuarial Science

Used in retrospective reinsurance rating plans to convert losses
to premium and provide for loss adjustment expense, overhead
and profit margin, subject to established maximums and
minimums.

Loss Ratio
Proportionate relationship of incurred losses to earned premiums
expressed as a percentage.

Loss Reserve
An estimate of the amount of outstanding loss remaining to be
paid for the reported claim; estimated expected payments for
reported and unreported claims.

Loss Trend Factor
Project known or developed ultimate losses to future cost levels
for a future coverage period; primarily applied in lines of business
that are adversely affected by inflation, e.g. Automobile and
General Liability.

Losses
Amounts paid or payable to claimants under the terms of
insurance policies.

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