Question
1) Star Alliance insures 311,240 cars in one country. The company expects to pay $39,838,720 in incurred losses and loss adjustment expenses for insured damages
1) Star Alliance insures 311,240 cars in one country. The company expects to pay $39,838,720 in incurred losses and loss adjustment expenses for insured damages to these cars. Based on their previous expense ratio, the insurer wants to allow for 36% for other expenses, profit, and a margin for contingencies. Calculate the gross premium paid by the insureds?
2) Under a surplus-share agreement, Gulf Insurance has a retention limit of $488,930 per exposure unit and can transfer $1,740,400 to Bahrain Re. Gulf insured a shopping center valued at $1,880,500. Two months later a minor fire caused a loss of $30,000. How much will the reinsurer pay towards the loss?
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