Question

What is the basis used for all types of excess of loss treaties?

a.

Flat Premium

b.

Burning cost

c.

Flat Rate

d.

Catastrophe excess

Posted under IC85 Reinsurance Management

Answer: (c).Flat Rate Explanation:The reinsurer may quote a Flat Rate as a percentage which is applied to the gross premium income of the particular class of business. This basis is used for all types of excess of loss treaties – both “working” and “catastrophe”.

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