Claim Frequency

Claim Frequency refers to the ratio of the number of claims arising from insured events to the total number of insured units over a certain period (usually one year). It is a core indicator measuring how frequently insured risks occur. In foreign trade, it is mainly used in cargo transportation insurance (such as sea, air, and land transport) and export credit insurance. Use cases include: insurers assessing premium rates, enterprises analyzing logistics or customer risks, and choosing trade terms and insurance plans. Note: Claim Frequency only reflects the frequency of claims, not the amount of a single loss (the latter is measured by average claim amount or loss ratio); it differs from 'loss ratio' (claims/premiums) as it focuses on accident frequency. In addition, a high claim frequency may lead to premium increases or refusal of coverage, so enterprises should reduce it by improving packaging, choosing reputable freight forwarders, and strengthening credit management. It is sometimes used interchangeably with 'claim rate', but strictly speaking, claim rate may include pending claims, while claim frequency is usually based on occurred incidents.