What does Stratified Random Sampling mean? Read on to discover the definition & meaning of the term Stratified Random Sampling - to help you better understand the language used in insurance policies.
Stratified Random Sampling
Stratified random sampling is a data analysis technique that involves dividing a population into different groups or strata, and then taking a random sample from each in proportion to the strata's size in relation to the population. Doing so produces a more representative group for the variable being studied. Insurance companies use this technique to better estimate expected loss and thereby determine premiums for their policies.
We hope the you have a better understanding of the meaning of Stratified Random Sampling.