What Does Written Exposure Mean?
Written exposure refers to the assets, or units that are included on insurance policies, generated during a specific period of time. It is crucial for insurance companies to have an exact picture of its written exposure so that it can know how exposed it is to losses. Too much written exposure puts the company at risk of insolvency.
Insuranceopedia Explains Written Exposure
An insurance company with high written exposure levels could face serious financial trouble if too many of too many policyholders file claims at once. For this reason, insurers need to keep tabs on their written exposure to make sure that they don't assume too much risk and reduce the odds that they'll face a volume of claims that is too heavy for them to handle.
A relatively high level of written exposure can be counterbalanced by setting correspondingly high premiums.