Page 226 - Reinsurance Management IC85
P. 226
The Insurance Times
A profit commission on an "Accounting Year"
basis requires all transactions for the same treaty
period, without reference to underwriting year,
to be included in the same profit commission
statement. A typical example would include the
following items.
Debit Credit
Commissions Premium Reserve
brought forward
Claims Loss Reserve
brought forward Premiums
Miscellaneous charges
Premium Reserve carried-forward
Loss Reserve carried forward
Allowance for reinsurer's expenses Profit for Year.
The reserves mentioned above are statistical
reserves and do not relate to any cash reserves
the ceding insurer may be retaining from the
reinsurer although they may be replaced by
"Portfolio Transfers".
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