Incurred Losses

Plain English Definition: The total amount of losses an insurance company is responsible for during a specific period.

What Incurred Losses really means for someone with an insurance policy

Incurred losses include claims paid, adjustments, and outstanding claims. They reflect the insurer’s financial obligations related to claims.

Incurred Losses Real World Examples

• An insurance company paying $50,000 in claims for storm damage has incurred losses of $50,000.
• If a policyholder files a $10,000 claim still being processed, it is considered part of incurred losses.
• Medical expenses reimbursed by health insurance count as incurred losses for the insurer.