LAE are expenses incurred while determining the value of a claim, over and above the cost of the claim. These can include fees from doctors, trial lawyers, and adjusters. Loss adjustment expenses are divided into two categories, Allocated Loss Adjustment Expenses (ALAE) and Unallocated Loss Adjustment Expenses (ULAE).

The expenses associated with handling claims against a policy of insurance. They are normally broken down into two categories - Allocated and Unallocated. Allocated Loss Adjustment Expenses are often (depending upon the specific reinsurance contract) considered part of the loss to the reinsured and may be recovered as part of the reinsurance payments from the reinsurer: By contrast, Unallocated Loss Adjustment Expenses are considered part of the reinsured's cost of doing business and are therefore not recoverable from reinsurers.

Payments by an insurer for the investigation and settling of claims. They include the cost of defending a lawsuit in court.