The underwriterâ€™s calculation of probable maximum loss.
Based on past experience, data, and statistics, an estimate is generated to predict the probable occurrence(s) of loss for a given period for either a specific insured or class of business.
An underwriting estimate of the maximum loss possible.
An insurer's estimate of the cost of claims that could arise from the peril insured against.
An underwriter's estimate of the probable maximum loss to be suffered on an exposure being considered, with attention given to the expected level of loss prevention activities on the part of the insured.