Compute an insurer’s combined ratio from loss and expense ratios.
Please do not make financial decisions based on these results.
What is the Combined Ratio Calculator?
Compute an insurer’s combined ratio from loss and expense ratios. To use the Combined Ratio Calculator, enter incurred losses, expenses, earned premium; it returns combined ratio, loss ratio, expense ratio, and shows them instantly as you type.
Where the Combined Ratio Calculator fits
Compute an insurer’s combined ratio from loss and expense ratios. The main figure it returns is the Combined ratio, worked out from the values you enter.
It belongs with the other business & everyday tools tools. If you are comparing options or checking a result from another angle, try the Loss Ratio Calculator, Fibonacci Retracement Calculator or the Pivot Point Calculator.
How to use the Combined Ratio Calculator
- Fill in the fields. You will need Incurred losses ($), Expenses ($), Earned premium ($). Use real figures from your own records where you can. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Combined ratio, and the cards below show Loss ratio, Expense ratio. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Combined Ratio Calculator using the default values shown in the calculator above:
Inputs
| Incurred losses ($) | 620,000 |
|---|---|
| Expenses ($) | 290,000 |
| Earned premium ($) | 950,000 |
Results
| Combined ratio | 95.79% |
|---|---|
| Loss ratio | 65.26% |
| Expense ratio | 30.53% |
With these inputs the calculator returns Combined ratio: 95.79%. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Incurred losses ($) from 620,000 to 744,000 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Combined ratio | 95.79% | 108.84% | +13.6% |
| Loss ratio | 65.26% | 78.32% | +20% |
| Expense ratio | 30.53% | 30.53% | 0% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Combined Ratio Calculator reports Combined ratio, loss ratio and expense ratio. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
What is a good combined ratio?
Below 100% means an underwriting profit.
Can I use these for business?
Yes for quick estimates, but confirm official figures with your accountant.
What is the difference between margin and markup?
Margin is profit divided by the selling price. Markup is profit divided by cost. A 50% markup equals a 33% margin.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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