Enter the premium cost (\$), the estimated cost of retained losses (\$), and the risk management costs (\$) into the Total Cost of Risk Calculator. The calculator will evaluate the Total Cost of Risk.

## Total Cost of Risk Formula

The following formula is used to calculate the Total Cost of Risk.

TCOR = PC + RL + RMC

Variables:

• TCOR is the Total Cost of Risk (\$)
• PC is the premium cost (\$)
• RL is the estimated cost of retained losses (\$)
• RMC is the risk management costs (\$)

## How to Calculate Total Cost of Risk?

The following steps outline how to calculate the Total Cost of Risk.

1. First, determine the premium cost (\$).
2. Next, determine the estimated cost of retained losses (\$).
3. Next, determine the risk management costs (\$).
4. Next, gather the formula from above = TCOR = PC + RL + RMC.
5. Finally, calculate the Total Cost of Risk.
6. After inserting the variables and calculating the result, check your answer with the calculator above.

Example Problem:

Use the following variables as an example problem to test your knowledge.