What does COR in the insurance industry mean? What does the target COR mean?

Cor of an insurance company, the abbreviation of comprehensive cost rate, represents whether the cost rate of an insurance is high or low. According to the insurance market, it is best to control cor at 100%, because once it exceeds 100%, it means that the cost is too high and it will bring losses. And below 100% means profit.

Profit = 1-Cor, for example, Cor is 95%, then the profit rate is 1-95%=5%, that is to say, if the premium of 100 yuan is charged, then the cost of the insurance company is 95 yuan, earning 5 yuan, which is the underwriting profit.

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Cor= payment rate+expense rate.

Payout ratio is the ratio of indemnity to premium of insurance companies.

If the premium received this year is 654.38+0 billion, and the compensation is 70 million, then payout ratio is 70%. Of course, it can't be that simple in actual calculation.

Indemnities are divided into settled claims and outstanding claims, and settled claims are money that has been lost. However, insurance claims do not lose money as soon as an accident happens. It may be that the customer reported the case late, the treatment and repair cycle may be long, and the accident has not happened yet. All these require insurance companies to reserve some funds for compensation. This is the so-called outstanding compensation.

Expense rate is the direct cost of insurance company, including: salesman's commission (paid to the direct seller), insurance guarantee fund, business tax (paid to the state), back-office management company and social security cost, workplace cost and so on.

For consumers, insurance companies make money and don't make money. The biggest two meanings are:

1, product stability: one-year insurance, most conditions do not guarantee renewal (the highest in the market is only 6 years), so whether the insurance company makes money is related to whether the product will stop selling. If the product is unstable, it will be extremely unfavorable to consumers. After all, no one can guarantee the smooth connection between physical condition and the conditions audited by insurance companies every year.

2, the severity of claims: after all, there is always an ambiguous situation, you can pay or not. When you lose money, you are bound to be inclined not to lose money. So consumers' perception is very different.

Therefore, for one-year insurance, it is recommended to look at the profit index of the insurance company, not just the premium.