What Does Basis Points Mean?

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What does Basis Points mean? Read on to discover the definition & meaning of the term Basis Points - to help you better understand the language used in insurance policies.

Basis Points

Basis Points

A way of expressing, using a base of 100, the increments of measurement between percentage points. For example, 50 basis points equal one-half of 1 percent; 200 basis points equal 2 percent. Ceding commissions, collateral costs, and other quantifiable data used in insurance and reinsurance agreements may be expressed in basis points.

We hope the you have a better understanding of the meaning of Basis Points.

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