Actions performed by the insured to reduce the chance of a loss or the extent of a loss, for example, locking valuables in a safe or keeping fire extinguishers in a home or business.
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Actions to reduce the frequency or severity of losses. Installing locks, burglar or fire alarms, and sprinkler systems are loss control techniques.
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All methods of reducing the frequency and/or severity of losses including exposure avoidance, loss prevention, loss reduction, segregation of exposure units and non-Insurance transfer of risk, A combination of loss control or risk control techniques with risk financing techniques forms the nucleus of a risk management program. Loss Control, the Domino Theory, Heinrich’s : This theory holds that all accidents are the result of a chain of events or row of dominoes which includes: The ancestry of environment of the accident (such as general community conditions or the basic character or the basic character of a person involved in the accident);The fault of a person (such as recklessness), an unsafe act and/or safe physical condition (such as negligence, intentional wrong doing the absence of a necessary machine guard, or insufficient lighting);An accident (such as a person falling or a machine falling under stress); andResulting losses (such as bodily injury, damage to property or environmental pollution).Each element in this sequence can be viewed as a domino which, if it falls, will knock over the following dominoes and result in a loss. By this theory, the key to accident prevention is to remove one of the dominoes so that, should a preceding domino fall, the following ones will remain standing and no losses will occur.

Insurance company employees who perform loss control surveys or inspections and prepare written loss control reports outlining their findings. Also referred to as safety engineers.

A technique designed to change the loss exposure itself, the objective being to reduce the frequency or severity of the potential losses or to make those losses more predictable.

A term used in a retrospective rating plan. It is a factor applied to the losses in the formula to give the insurer the funds needed to handle the investigation of claims.

The portion of the premium rate represented projected losses with or without LAE or ALAE.

Loss data that has been modified by insurance advisory organizations by necessary loss development, trending, and credibility processes in order to arrive at the statistical cost of losses to be used in establishing a premium rate.

Sometimes called claims department. That part of an Insurance Company that pays and handles claims of losses.

An actuarial method to detect and correct for consistent errors in estimating the amount of future loss payments or the procedure for adjusting incurred losses to reflect their future development and ultimate value. Loss development factors are developed actuarially and applied to current losses in order to predict what the ultimate cost of losses will be when the claims are closed.
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The difference between the amount of losses initially estimated by the insurer and the amount reported in an evaluation on a later date.
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UK: The difference between the initial estimate of a loss and the amount estimated at a later date or the amount paid on settlement at which point it is the difference between the amount reserved and the amount paid.
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US: The difference between the original loss as initially reserved by an insurer and its subsequent evaluation later or at the time of its final disposal. Loss development occurs because of (1) inflation—both “social inflation” and inflation in the consumer price index—during the period in which losses are reported and ultimately settled and (2) time lags between the occurrence of claims and the time they are actually reported to an insurer. To account for these increases, a “loss development factor” (LDF) or multiplier is usually applied to a claim or group of claims in an effort to more accurately project the ultimate amount for which they will be closed.
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REINSURANCE: The difference between the original loss as originally reported to the reinsurer and its subsequent evaluation at a later date or at the time of its final disposal. A serious problem to reinsurers who, being involved in the more serious cases, must frequently wait many years for the final disposition of a loss.
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The difference between the value of the losses estimated by the insurer and the amount reported on a later date.
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REINSURANCE: The process of change in the value of claims over time until the claims are fully settled and paid. It is measured by the difference between paid losses and estimated outstanding losses at some subsequent point in time (usually 12 month periods), and paid losses and estimated outstanding losses at some previous point in time. In common usage it might refer to development on reported cases only, whereas a broader definition also would take into account the IBNR claims.