What does 'insurability' measure?

'Insurability' measures the likelihood of a risk being accepted by insurers. This concept is fundamental in the insurance and risk assessment landscape. When insurers evaluate a particular situation, property, or individual for coverage, they assess the associated risks and determine whether those risks are acceptable enough to warrant offering insurance.

Insurers look at various factors, including the history of claims, potential future claims, the nature of the risk, and market conditions. By doing this, they can ascertain not only if they are willing to assume the risk but also if they can do so at a profit while maintaining stability in their portfolio. A high level of insurability indicates that the risk aligns well with the insurer's guidelines and that the likelihood of payout is minimized.

The other aspects mentioned in the question, such as claims processing speed, profitability, and coverage amounts, relate to different facets of the insurance industry but do not directly define insurability itself. Claims processing speed is about operational efficiency, profitability deals with the overall financial health of the insurer, and coverage amounts pertain to the terms of a specific policy rather than the acceptance of risk.