Insurance Archives | Insurance Software development

Classification of Insurance Companies

Author - Webner
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6:26 am
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Insurance Companies

An insurance company is defined as an organization that provides financial protection and reimbursement of damages to an insured person or an organization according to the policy agreement. These companies provide insurance by collecting premiums from policyholders and ensure those policyholders to cover the losses if they suffer during the policy period. Because of the nature of their policies, an insurance company must perform common functions that are unique in providing its services, underwriting, loss adjustment, and investment.

Insurance companies may be classified in different ways: according to the type of insurance that they sell, their […]

How to measure the financial strength of an insurance company?

Author - Webner
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7:06 am
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Introduction to financial strength of an insurance company

In another blog, we have already discussed “How do an Insurance company makes money?” Usually, the business element of the insurance agencies revolves around charging premiums in exchange for insurance coverage, then reinvesting those premiums into other interest-generating assets.

Insurance companies deal with large and complex claims made against policies that are sold by them. Including this, an insurance company faces various kinds of risks. Therefore, before investing in an insurance company, investors should know the financial status of that company. In this blog, we will discuss, how we […]

Quick Liquidity, Current Liquidity, and Operating Cash Flow

Author - Webner
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5:34 am
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Financial Parameters in an Insurance Company – Quick Liquidity, Current Liquidity, and Operating Cash Flow

Quick liquidity, current liquidity, and operating cash flow are parameters of an insurance company used to determine the financial strength of the company. Each of these parameters is important for the companies and they put their best on these factors to strengthen their financial status. We will discuss the meaning and functioning of these three parameters below.

Quick Liquidity

The quick liquidity of an insurance company is the total amount of the company’s quick assets divided by the sum of its […]

What is the difference between the Loss Ratio and Expense Ratio?

Author - Webner
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6:50 am
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Introduction

We have already discussed the meaning and relevance of the Expense Ratio in the Insurance sector. However, it is imperative to understand various other ways that an insurance company uses to calculate its efficiency. In order to do that, we must know the importance of the Loss Ratio as part of the combined ratio that provides basic guidelines to the targets and achievements of the company’s underwritten policies.

How is the Loss Ratio calculated?

It is calculated in comparison with the premiums earned (as its percentage). Losses in this ratio include the adjustment expenses […]

How do you measure a company’s liquidity?

Author - Webner
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5:49 am
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What is Liquidity?

The measure of ability with which assets can be easily sold or bought is known as liquidity. The assets which fall under liquidity are known as liquid assets. Cash is considered to be the most liquid asset that one can have. Other than cash, saving accounts, and checkable accounts are also liquid assets. All the types of assets like Real Estate or Equities come under different levels on the liquidity spectrum.

Liquidity of a company

When we use the term “Liquidity” in business, it means the ability of an organization to turn its […]

Profitability Ratios For Casualty Companies

Author - Webner
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6:27 am
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Introduction to Profitability ratios

Profitability ratios are defined as a set of financial metrics that are used to evaluate a business’s ability to make profits relative to its revenue, operating values, balance sheet assets, and shareholders’ equity over time by using the data from a specific point in time. In simple words, with these profitability ratios, insurance companies generally compare numbers from their financial performance to determine how profitable, effective or liquid their businesses are, in certain areas, from year to year. These ratios also allow the insurance companies to compare with their competitors across the street […]

WinsurTech AL3 Parser | Convert ACORD AL3 to JSON, Excel, CSV, PDF Formats

Author - Webner
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2:36 pm
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Overview (Online Demo)

WinsurTech AL3 Parser is a command-line translater application that converts the ACORD AL3 format file to JSON, CSV and PDF formats. The latest version of the Parser is using the latest ACORD AL3 Standard 2019 groups and elements information. WinsurTech is an ACORD Member. WinsurTech AL3 Parser is a standalone library (supported for both Windows and Ubuntu) that can be invoked from the command line or through a program written in any programming language like PHP, C#, Python, NodeJS, Ruby or any other. AL3 parser is an optimized AL3 to the multi […]

How do Insurance Companies make money?

Author - Webner
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6:16 am
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Introduction

Everyone knows that change is the only constant in this unpredictable world that we live in. But human beings have evolved themselves by getting familiar with the surroundings. As a result, they either try to repel the change that inhibits their basic functions or adapt themselves to it. In an environment that is run by the mighty nature, we are still at its mercy. To avoid any unprecedented circumstances, (be it an earthquake, accident, terminal illness, etc.) that can affect our livelihood, insurance was invented.

What is Insurance?

Insurance is a shared bond between the […]

Different Classes Of Insurance

Author - Webner
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7:13 am
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Introduction to Insurance and Classes of Insurance

Insurance policy is a contract in the form of a policy that binds one party to cover the risks in exchange for time-bound premiums decided preemptively. The insurance companies generally pool the money collected from its customers and make profits on the probability that the claims made against premiums submitted would be always lesser. In this way, the insurance companies work on the principle of charging more premiums than the possibility of the claims made against it.

Having discussed what an insurance company is and how they make profits, we […]

What is the Expense Ratio for an Insurance Company?

Author - Webner
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6:33 am
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Introduction to Expense Ratio

Providing financial security to its consumers is the ultimate aim of an insurance company. However, sustaining its own capability to finance its customers becomes its priority. To measure the financial sustainability, insurance companies use various different methods and techniques. Among them, the Expense Ratio serves as the ideal measure providing clarity on the logistics. Signifying the efficiency of an insurance company and measuring its profitability, the expense ratio gives a clearer picture of the financial aspects of the company.

Calculating Expense Ratio

There are generally two ways by which companies calculate the […]

How do P&C insurance companies make money?

Author - Webner
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5:22 am
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Introduction to P&C (Property and Casualty) insurance

Insurance is defined as a contract in which an individual or organization receives financial protection and reimbursement of damages from the insurer or the insurance company. On a basic level, Insurance is some form of protection from any unpredictable financial losses. We all know about life insurance, but there is another category of insurance known as P&C insurance which is quite different. Life insurance covers risks only associated with human mortality and morbidity whereas P&C insurance is focused on risks that result in a loss to property and […]

What is a good liquidity ratio for an insurance company?

Author - Webner
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6:47 am
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Introduction

In another blog, we have already discussed the liquidity ratio for an insurance company and how we can measure it. The liquidity ratio of a company shows the ability of a company to turn its assets into cash. This ratio is used to compare the financial performance of insurance companies and also used to determine how profitable a company is from year to year. Investors and creditors use this ratio to observe the potentiality of an insurance company before investing in it. In this blog, we will discuss a little more about the liquidity ratio and what […]

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