Hi, One of the lines in the "Cost versus Benefit" section has thrown me - for a specific large loss it states that "The reinsurer was lucky in that nine lines of the surplus treaty were used" but is that right? As I understand it EML = (1 + number of lines used) x retention So, the more lines used, the less retention for the insurer and the more exposure passed to the reinsurer? Is this just a typo and it should read "the insurer was lucky.."? Thanks in advance
Hi, yes I think you're right in that it's the insurer who was lucky rather than the reinsurer. Well spotted - we'll change this in the solutions. Coralie
