Reinsuance Pricing

Front 1

7 Steps in Pricing Analysis for Proportional treaties

Back 1

1 Compile Historical Data
2 Exclude Cat and Shock Losses
3 Adjust Experience to Ultimate and Project to Future Period
4 Select Non-Cat LR
5 Load the NC LR with a CAT load
6 Estimate Combined Ratio, given ceding commisions and other Expenses
7 Evaluate other features of the treaty (ceding commision, Reinsurer's expenses, brokerage fees)

Front 2

4 Steps in Experience Rating for Casualty Excess Treaties

Back 2

1 Obatain historical Premium and Loss Data for as many years as possible
2 Adjust Premium to current level
3 Apply loss trends to individual losses
4 Apply Excess loss Development Factors to the summed loss for each period

Front 3

3 Approaches to Allocate Surplus in Reinsurance Products

Back 3

1 A Percentile set to an acceptable Probability of Ruin
2 The Variance or Standard Deviation of the Results
3 Statuatory Surplus Required to meet Regulator's Financial Tests

Front 4

2 Credibility MEasures Identified by Clark to Reconcile Experience and Exposure Rating Models for Property Per Risk Treaties

Back 4

1 The Stabiltiy in the Year to Year historical Loss Cost Projections
2 The dollars of Expected Loss, based on Exposure Rating

Front 5

4 Approaches listed by Clark to estimate the Cat load for reinsurance Treaties

Back 5

1 Use an Average cat loading based on ceding company's rate filings
2 Use an Estimate an Estimate of the Average # of times the occurence limit is exhausted
3 Spread Cat losses over a longer period while adjusting historical cats to current levels
4 Use the Expected Cat amount for a catastrophe simulation model