Expected Loss

The average loss in the long run. The expected loss is the mean of the probability distribution of losses, not the mode.
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Arithmetic mean, or expected value, or the probability distribution of the amount of loss which may occur during one year (or other period). See Also: “Expected value” and “Normal loss.”

Expected Loss Ratio

Underwriting loss ratio-computed as incurred losses plus loss adjustment costs, all divided by earned premiums-which an Insurer expects to achieve for a given line of Insurance for a specified period. If the expected loss ratio is achieved, and if the Insurer’s operating expenses do not exceed normal levels, the Insurer earns is expected Underwriting profit.