For LR 65% in 2000:
Reins Prem=100*0.7=70M
Reins Comm=70M*0.29=20.3M
Reins Loss=70*0.65=45.5M
PC=70*(0.675-0.65)=1.75M
So Reins Profit=P-Comm-C-PC=2.45M
The original Profit=100M*(1-0.65-0.15-0.1)=10M
So the Cedant's Profit=10-2.45=7.55M.
Other scenario could follow the same kind of logic.
Last edited by a moderator: Apr 21, 2014