Assume that a primary insurer has per risk excess of loss reinsurance of $150,000 over $75,000. one top of this the primary insurer has per occurence excess of loss with a retention of $900,000. on top of both of these reinsurance policies, the primary insurer has a stop-loss treaty with the point of attachment equal to a loss ratio of 100%. the latter reinsurer will pay 95% of all losses above the point of arrachment to a loss ratio of 1.2.

over the year, the folowing claims are filled with the primary insurer (only one claim per policy). The last four claims are associated with one occurrence.

Claims:

$30,000

425,000

250,000

600,000

85,000

1,000,000

300,000

450,000

200,000

760,000