Quick guide
How to use this calculator
- Enter policy terms, losses, exposures, probabilities, reserves, or financial assumptions on a consistent basis.
- Use the actual policy wording or internal data definition for every limit, deductible, premium, loss, and recovery input.
- Compare multiple plausible scenarios and treat probabilistic outputs as model results rather than forecasts or coverage determinations.
Calculation method
Calculation method
Ruin occurs when event count reaches ceil(capital ÷ net loss); probability uses a binomial event-count model.
Deterministic currency and ratio calculations use exact fixed-decimal arithmetic. Simulated or distribution-based tools identify their approximation and reproducibility conventions.
Worked example
Worked example
Capital of 100,000 facing 25,000 net losses across ten 10%-probability periods can be modeled.
Ruin occurs when event count reaches ceil(capital ÷ net loss); probability uses a binomial event-count model.
Supported inputs
Precision and limits
Insurance and risk scope
This binomial approximation assumes independent periods and a fixed net loss per event. It ignores investment return, loss clustering, changing exposure, and partial recovery.
Policy wording controls
Actual deductibles, exclusions, valuation clauses, waiting periods, sublimits, aggregates, reinsurance terms, and legal coverage depend on the contract and jurisdiction. The calculator cannot interpret or bind coverage.
Model and data consistency
Keep gross versus net, written versus earned, paid versus incurred, exposure periods, probability horizons, and currency bases consistent. Historical averages and probability models do not guarantee future outcomes.
No quote or professional determination
Results do not quote a premium, approve a claim, establish an actuarial reserve, determine regulatory capital, recommend self-insurance, or replace an insurer, broker, actuary, accountant, risk professional, or legal adviser.
Precision and privacy
Plain decimals accept up to 30 digits and 12 decimal places. Calculations remain in this browser and raw entered values are not submitted to 365CALCS.COM.
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