Burning Cost Ratio

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Burning Cost Ratio

In insurance, the ratio of losses for which a reinsurer pays to the insurer's premium income. It is also called pure less cost.
References in periodicals archive ?
Underwriting expense includes costs to acquire business, such as administration, advertising, marketing, taxes, licenses, fees, agent commissions, policy issuance costs; and costs to ensure that the acquired business is rated accurately, such as data, systems, and administration costs--that is, all costs except pure loss cost and LAE.
7 percent in the pure loss cost factors to the California State Insurance Department, but we do not know whether or when this recommendation will be adopted.
We are encouraged by the California Insurance commissioner's recent proposed increase to the pure loss cost rates, effective Jan.
For instance, when some risk managers speak of costs, they mean pure loss costs, while others may refer to total premiums.
This deeper understanding covers not only pure loss costs and sales expenses but also supports underwriting, customer service and shared service costs such as information technology, human resources and finance that make up true product pricing.