Work out claim frequency and severity instantly with clear inputs, formula shown and shareable results.
Actuarial pricing decomposes loss cost into frequency — claims per exposure unit — and severity, the average cost per claim. Their product is the pure premium, to which expense and profit loadings are added. Separating them matters because they respond to different drivers and trend at different rates.
Frequency
Frequency = Number of claims / Exposure units
Severity
Severity = Total claims paid / Number of claims
Pure premium
Pure premium = Frequency x Severity
Indicative estimate only. Fees, entitlements, limits and formulas vary by jurisdiction, statute, policy wording and the facts of the case. This is not legal, tax, insurance or financial advice — confirm with a qualified professional or the relevant authority.
Because they behave differently: frequency responds to behaviour and deductibles, severity to inflation, medical costs and repair costs. Trending them separately is far more accurate.
Whatever best measures risk exposure — vehicle-years for motor, insured-value-years for property, payroll for workers compensation.