Dekningsfaktor
Dekningsfaktor, literally “coverage factor,” is a metric used in finance, insurance and risk management to quantify the extent to which a set of resources covers a given requirement. It is a dimensionless ratio, typically expressed as a number between 0 and greater than 1, depending on whether resources fall short, meet, or exceed the needed coverage.
In pension funds and insurance, the term is used to describe the extent to which projected liabilities
In project budgeting and corporate risk management, the factor serves a similar purpose: it compares the amount
Calculation example: If a plan estimates 100 million in future claims and holds 80 million in reserves,
Limitations include reliance on estimates, market changes, and regulatory rules, which can affect both liabilities and
Etymology: from Norwegian/Swedish deknings- meaning coverage, and faktor meaning factor.