Estimate the probability-weighted annual claim payment for a auto insurance scenario. Enter a representative covered loss, deductible, applicable limit, estimated annual probability, and premium. The result separates the insurer’s payment if the loss occurs from the expected annual payment and the portion of the loss you retain. This simplified model is useful for scenario comparison, but it cannot determine whether a specific claim is covered.
Expected payment is a probability-weighted average across many hypothetical years, not the amount you should expect in a particular year.
Real claims depend on cause of loss, exclusions, valuation terms, sublimits, liability, and claim settlement. Review the policy.
A $8,000 covered loss with a $1,000 deductible produces a $7,000 insurer payment. At a 8% annual probability, expected claim payment is $560.00.
No. It is a probability-weighted estimate based entirely on the scenario values you enter.
Because this simplified model assumes the insurer pays only the covered amount above the deductible.
The estimated insurer payment cannot exceed the applicable limit, even when the covered loss is larger.
No. Premium is a separate cost; the calculator displays expected payment minus annual premium as a secondary comparison.
No. It models one representative loss scenario and its annual probability; repeated claims require a frequency-severity model.
| Variable | Role |
|---|---|
| Covered loss | Scenario amount before deductible |
| Deductible | Retained amount before payment |
| Limit | Maximum payment used by the model |
| Probability | Annual scenario assumption |