Question

How is the extent of cover necessary for excess of loss protection determined?

a.

After studying the pattern of exposures in the portfolio.

b.

By scaling down the retention for smaller and older vessels.

c.

By fixing the retention at aggregate sums insured per vessel through all documents.

d.

By determining the total loss and general average claims affecting all cargo on board the vessel.

Answer: (a).After studying the pattern of exposures in the portfolio. Explanation:The extent of cover necessary is determined after taking into account the pattern of exposures.

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Q. How is the extent of cover necessary for excess of loss protection determined?

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