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Premium = total premium + incoming premium reserve
Loss ratio - outgoing premium reserve
= Rs.30,00,000 + Rs.10,00,000 - Rs.12,00,000
= Rs.28,00,000
= (14,00,000 x 100) / 28,00,000 = 50%
Commission = 30% of Rs.30,00,000 = Rs.9,00,000
b) Fire Excess of Loss cover for 2010
Rs.10,00,000 XS Rs. 5,00,000
Minimum and deposit premium = Rs. 10,00,000
Payable in 4 installments = Rs. 2,50,000
1st Jan = Rs. 2,50,000
1st Apl = Rs. 2,50,000
1st July = Rs. 2,50,000
1st Oct = Rs. 2,50,000
Note:- In case of calculation of minimum & deposit premium
installment the amount of brokerage is not deducted
from the principle premium figure.
Q5. a) What is the need for an efficient
statistical system?
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