Consider the same food manufacturing plant as in Question 12.

The underwriting guidelines for food manufacturing plants are also as before, with the following exceptions:

• The exposure curves in use are the Swiss Re curve with c=3.8 for PD, c=3.1 for BI. In both cases, these are defined from the ground up.

• Since the curves are from the ground up, there is no need for a deductible impact table Calculate:

i. The rate at the local deductible for both PD and BI ii. The expected losses to the layer £90M xs £10M (all in excess of the local deductible)