For question1-8

The primary insurer and the reinsurer have entered into a surplus-share arrangement. The primary insurer has a retention limit of RM200,000 (called a line) for a single policy, and that four lines are ceded to the reinsurer.

1. How much is the maximum amount of insurance can be ceded to the reinsurer?

2. How much is the total underwriting capacity of the primary insurer?

Assume that a RM200,000 property insurance policy is issued and there is a loss of RM140,000.

3. How much is assumed by primary insurer?

4. How much is assumed by reinsurer?

Assume that a RM700,000 property insurance policy is issued and there is a loss of RM140,000.

5. How much is assumed by primary insurer?

6. How much is assumed by reinsurer?

Assume that a RM1 million property insurance policy is issued and there is a loss of RM140,000.

7. How much is assumed by primary insurer?

8. How much is assumed by reinsurer?