1. Property Reinsurance Ratemaking Sean Devlin Reinsurance Boot Camp on Pricing Techniques July 29, 2005

3. Background

4. Exposure Rating

5. ELR Determination

6. ELR Calculation - Per Risk/Pro Rata

7. ELR Determination

8. Note on Primary “Price”

9. Note on Primary “Price”

10. Primary “Price” (cont’d)

11. Primary “Price” (cont’d)

12. Primary “Price” (cont’d)

13. Exposure and Experience Rating

14. Experience Rating

15. Exposure Rating – Loss Curves (cont’d)

16. Exposure Rating – Loss Curves (cont’d)

17. Exposure Rating – Loss Curves (cont’d)

18. Exposure Rating (cont’d)

19. Exposure Rating (cont’d)

20. Exposure Rating - PSOLD 2004

21. Exposure Rating (cont’d)

22. Exposure Rating (cont’d)

23. Exposure Rating (cont’d)

24. Exposure Rating (cont’d)

25. Exposure Rating (cont’d)

26. Weighting of Methods

27. Catastrophe PerilPer RiskPro RataCat XL

28. Vendor Models –What to Use?

29. Vendor Models –What to Use? (Cont’d)

30. Vendor Models –What to Use? (Cont’d)

31. Vendor Models –What to Use? (Cont’d)

32. Vendor Models –What to Use? (Cont’d)

33. Model Inputs

34. “Unmodeled” Perils

35. “Unmodeled” Perils (cont’d)

36. “Unmodeled” Perils (cont’d)

37. “Unmodeled” Perils (cont’d)

38. “Unmodeled” Perils (cont’d)

39. “Unmodeled” Perils (cont’d)

40. “Unmodeled” Perils (cont’d)

41. Using the Output

42. Experience Rating – Adjustments

43. Loadings to final EL

44. Capacity Charge - Simplistic

45. Conversion to Pricing

46. Finishing The Job

47. Pro Rata Example

48. Key Takeaways