Umbrella exposure formula with drop down

pass8now — Tue, 27 Sep 2022 14:59:16 +0000

In this example, when the Umbrella drops down to cover the underlying exposure, the formula seems to imply that the reinsurance treaty would cover losses of 500xs500 on an underlying limit of $1M xs 0.

Is this truly the case here with the E[X;0.5] at the end of the numerator (page 33 of 52)

Exposure rating with ALAE included with Loss

tracyguo8 — Fri, 29 Jul 2022 18:04:35 +0000

Hi,

For the Exposure Rating for Casualty per Occurrence Risks, when the ALAE is included with Loss, there is this adjusted exposure factor formula. What is the next step - how do we calculate the reinsurer expected loss and ALAE after calculating the adjusted exposure factor?

If the ALAE is pro-rata to loss, it makes sense that the reinsurer expected loss and ALAE = exposure factor x (expected LR + ALAE%) x subject EP since the exposure factor for ALAE is proportional to the exposure factor for loss, but how do we calculate the "ALAE" portion of the reinsurer expected loss & ALAE when ALAE is included (add on) with loss??

Appreciate your input!

Thanks!

Clark.CasPerOcc — BattleActs Exam 8 Forum

Umbrella exposure formula with drop down

Exposure rating with ALAE included with Loss