General definition: payout ratio at the expiration of the policy year = the sum of the determined claims and outstanding claims under the effective policy in the underwriting year/the expiration premium of the policy in the underwriting year × 100%.
2. Calendar-year payout ratio refers to the ratio of the sum of the actual settled claims and outstanding claims to the corresponding due premiums in the statistical interval, reflecting the immediate compensation capacity and operating performance. Calendar year payout ratio considers the long-term quality and impact of business. General insurance companies take the calendar year payout ratio as an important indicator to measure the business quality of a business or a sales department. From the perspective of "the natural annual trend of insurance subject management", it is more valuable than the expired payout ratio. However, its disadvantage is that there is no way to measure the quality of business this year. Because, calendar year payout ratio will be affected by the quality of business last year or even earlier, which is particularly reflected in engineering insurance. Because there are many long-term businesses in engineering insurance.
3. The ratio of the insurance company's incurred indemnity expenditure to the earned premium. The incurred indemnity expenditure includes the difference between the indemnity expenditure, reinsurance indemnity expenditure and the outstanding indemnity reserve, and deducts the amortized indemnity expenditure and recovery income.
Comprehensive payout ratio = (settled claims this year+net outstanding claims reserve accrual+reinsurance claims expenditure-amortized reinsurance claims-recovery income)/(current premium income-ceded premiums+ceded premiums-unearned liability reserve accrual) * 100%.
4. One of the two indicators, IBNR and INBER, is called "Liability Reserve for Occurred Unreported Cases" and the other is called "Liability Reserve for Occurred Underreported Cases". In order to prevent major financial fluctuations and prepare funds as early as possible, IBNR, that is, the reserve for unreported liabilities, will be withdrawn. The withdrawal amount is subject to actuarial and claims estimation, and IBNER is generally used less, because customers always report more cases, and often the amount filed later is much larger than the actual settlement amount, and finally a large reserve is amortized, which is counted as the profit of the next year.
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