In-Force Exposure

What Does In-Force Exposure Mean?

In-force exposure refers to exposure units that are currently at risk of loss.

Insurance companies calculate in-force exposure to assess their overall risk at a given moment. These calculations help insurers determine whether they have assumed too much risk or if they are in a position to take on more.

Insuranceopedia Explains In-Force Exposure

All measures of exposure essentially calculate an entity’s vulnerability to incurring losses. In-force exposure specifically measures the level of exposure an insurance company faces on a given day.

If insurance companies fail to track statistics like in-force exposure, they risk losing sight of their sustainability levels. For this reason, insurers often employ math experts known as actuaries to calculate factors such as in-force exposure. Actuaries and the insights they provide serve as an insurance company’s strongest defense against insolvency.