Average Severity
Categories: Insurance
Insurance claim liability...how bad or severe was the damage claim?
So you're the insurer covering a bunch of beach houses. A tsunami hits. They all had "Act of God" insurance and you, the insurer, are fully liable save for a $10,000 deductible for each of the 80 homes which are now unintentional houseboats. Or fish condominiums.
The average claim? Well, by the time all the homes were rebuilt, you had paid out a total of $40 million for the 80 homes. That leads an average severity of this set of claims of 500 grand. Hopefully, the fish appreciate the new digs.
