Net loss
$120,000
Insurance response
$115,000
Uncovered amount
$5,000
Coverage ratio
95.8%
Shortfall
4.2%
Low shortfallInsurance & Protection Tools
Underinsurance Scenario Calculator
Stress-test a simplified insurance limit against several loss scenarios and see where the modeled protection begins to leave a meaningful uncovered amount.
Coverage stress test
Measure potential shortfall across multiple loss scenarios
Enter a coverage limit and simplified coverage factor, then test several user-defined losses to see the modeled insurance response, uncovered amount and shortfall percentage.
Simplified model: effective coverage = coverage limit × coverage factor. Insurance response is capped at the net loss and effective coverage, then the scenario/default deductible is subtracted. This does not model policy-specific coinsurance penalties or sub-limits.
Scenarios
3
Low-shortfall scenarios
2/3
Largest uncovered amount
$155,000
Highest shortfall
34.4%
Loss scenarios
Use different losses to see where the entered protection begins to leave a material gap.
Net loss
$300,000
Insurance response
$295,000
Uncovered amount
$5,000
Coverage ratio
98.3%
Shortfall
1.7%
Low shortfallNet loss
$450,000
Insurance response
$295,000
Uncovered amount
$155,000
Coverage ratio
65.6%
Shortfall
34.4%
High shortfallScenario comparison table
| Scenario | Loss | Insurance response | Uncovered | Coverage ratio | Shortfall |
|---|---|---|---|---|---|
| Moderate loss | $120,000 | $115,000 | $5,000 | 95.8% | 4.2% |
| Severe loss | $300,000 | $295,000 | $5,000 | 98.3% | 1.7% |
| Major loss | $450,000 | $295,000 | $155,000 | 65.6% | 34.4% |
Keep the stress test
Export or save the scenario set
Save CSV/PDF-style output or a reusable local FormatForge project file.
Sample scenarios loaded.
Shortfall model — not a claim estimate
Actual insurance outcomes depend on policy wording, valuation basis, deductibles, limits, sub-limits, exclusions, coinsurance clauses, depreciation and claim assessment. Use this tool to stress-test assumptions, not to predict an insurer's payment.
Scenario-based review
One coverage limit can behave differently across losses
A modest loss may sit well inside an entered limit while a severe loss can create a large uncovered amount. Using several scenarios makes the size of that modeled gap easier to see than looking at the policy limit alone.
Transparent assumptions
Keep simplified math separate from actual claim rules
FormatForge shows the coverage factor, deductible and other recovery used in each scenario. It deliberately avoids claiming that this simplified model reproduces policy-specific coinsurance, valuation, sub-limits or claim settlement.
Frequently asked questions
What does the Underinsurance Scenario Calculator measure?
It compares a simplified entered coverage amount against user-defined loss scenarios and shows the modeled insurance response, uncovered amount, coverage ratio and shortfall percentage.
Does a shortfall mean my actual policy is underinsured?
Not necessarily. The tool uses a simplified scenario model. Real policy outcomes depend on definitions, valuation, deductibles, limits, sub-limits, exclusions, coinsurance clauses and claim assessment.
What is the coverage factor?
The coverage factor lets you reduce the entered coverage limit for a simplified stress test. It is not a substitute for policy-specific coinsurance or average clauses and should not be interpreted as an insurer's formula.
Can I model other sources of recovery?
Yes. Each scenario has an Other Recovery field that reduces the modeled net loss before the simplified insurance response is calculated.
Can I use a different deductible for one scenario?
Yes. Enter a scenario deductible override. If it is zero, the workspace uses the default policy deductible entered at the top.
Can I save the scenario set?
Yes. You can copy the summary, export CSV, print/save a PDF-style report, or save a local FormatForge project file and reload it later.
Insurance workflow
Plan needs, then stress-test the protection
Use the Term Insurance Needs Planner or Family Protection Planner to estimate a needs-based protection range, then use this scenario tool when you want to test simplified coverage against different loss sizes.