Stratification Of Losses
Definition of "Stratification of losses"
Technique of breaking down the various losses as a whole into useful components called subsets (strata) so that no subset is overrepresented. The result is the classification of losses according to dollar amount in order to predict the probabilities of various degrees of loss severity so that the organization can adopt the proper risk management techniques.
Popular Insurance Terms
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Rate not subsequently adjusted. The rate stays in effect regardless of an insured's subsequent loss record. ...
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