Risk Premium Loading
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Loading covers everything beyond the expected loss: administrative expenses, commissions, taxes, a profit margin, and a risk margin that compensates the insurer for the uncertainty and variance around that expected loss estimate.

Loading factors vary by insurer based on their operating efficiency, distribution costs (agents vs. direct online sales), target profit margins, and how conservatively they price for uncertainty, so identical risk can be priced differently across the market.

Insurers add a larger risk margin when the variance around expected loss is high (e.g. new or poorly understood risks, catastrophe-prone perils) to protect against the chance that actual losses substantially exceed the expected average.

It often varies: smaller policies sometimes carry proportionally higher administrative loading (fixed costs spread over a smaller premium base), while large commercial policies may see loading reduced as a percentage due to economies of scale.

Rarely directly, but you can influence it indirectly: choosing higher deductibles reduces the insurer's expected loss and risk margin, bundling policies can reduce administrative loading, and a clean claims history often earns lower risk loading over time.