Question

How is excess of loss reinsurance organized into different levels?

a.

By categorizing losses based on occurrence of events

b.

By defining different thresholds for losses

c.

By retaining a portion of losses and reinsuring the excess at different prices

d.

By setting a limit on the maximum loss payable by the reinsurer

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (c).By retaining a portion of losses and reinsuring the excess at different prices Explanation:Excess of loss reinsurance is organized into different levels by retaining a portion of losses and reinsuring the excess at different prices.

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Q. How is excess of loss reinsurance organized into different levels?
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