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Lilac Insurance company has arranged an excess of loss ratio treaty with reinsurers whereby it will bear losses up to an amount not exceeding 75%
Lilac Insurance company has arranged an excess of loss ratio treaty with reinsurers whereby it will bear losses up to an amount not exceeding 75% of the gross premium of the class. The reinsurers have agreed to bear any balance so that the ceding companys gross loss ratio maintained at 75%, but not exceeding say 80% of the balance. Ceding companys premium income is Tk 1 Core and total loss over the year is Tk. 84 lakh . Under above arrangement how loss should be distributed between insurer and reinsurers?
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