Expected claims are scenario averages, not guaranteed outcomes or a compliant accounting reserve.
Try this with your own numbersFormula and worked example
Expected warranty cost = jobs × claim rate × resolution cost
| Input | Example |
|---|---|
| Completed jobs in cohort | 200 |
| Expected claim rate | 3 % |
| Average claim resolution cost | 180 |
| Calculated result | 1,080 |
Choose reliable inputs
Account for delivery time, review work and when you expect to be paid for each engagement. For this legal practice calculation, use time sheets, engagement scopes and invoice ageing and a consistent definition of one matter.
- Professional time: include the portion belonging to this matter or reporting period, and record where the value came from.
- Filing expenses: include the portion belonging to this matter or reporting period, and record where the value came from.
- Admin support: include the portion belonging to this matter or reporting period, and record where the value came from.
Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.
How much can callbacks cost after a job is paid?
Expected claims are scenario averages, not guaranteed outcomes or a compliant accounting reserve.
What if this input changes?
If completed jobs in cohort rises by 10%, this example changes by 108 . This shows the effect of one change; it does not predict what will happen.
Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.