Apex Health Insurance and Geneva Re Excess-of-Loss Per Risk Treaty

How does the excess-of-loss per risk treaty between Apex Health Insurance and Geneva Re work?

What is the retention limit for a single policy with Apex Health Insurance?

Explanation:

Apex Health Insurance has a retention limit of $100,000 for a single policy. This means that Apex Health will cover losses up to $100,000 for any given policy. However, for losses that exceed this limit, Apex Health has entered into an excess-of-loss per risk treaty with Geneva Re.

Calculation:

If Apex Health has a loss of $1.2 million, Apex Health will have to pay $100,000, and Geneva Re will pay $1 million.

Apex Health Insurance has a retention limit of $100,000 for a single policy. This means that Apex Health will cover losses up to $100,000 for any given policy. However, for losses that exceed this limit, Apex Health has entered into an excess-of-loss per risk treaty with Geneva Re.

Under this treaty, Geneva Re agrees to pay all losses exceeding $100,000, but only up to a maximum of $1 million of the sum insured. So, if Apex Health has a loss of $1.2 million, we need to determine how much Apex Health will have to pay.

Since the loss exceeds the retention limit of $100,000, Apex Health is responsible for paying the portion up to the retention limit. Therefore, Apex Health will have to pay $100,000.

The remaining amount of the loss, which is $1.2 million - $100,000 = $1.1 million, will be covered by Geneva Re, but only up to the maximum limit of $1 million. This means that Geneva Re will pay $1 million, and Apex Health will have to cover the remaining $100,000.

In summary, if Apex Health has a loss of $1.2 million, Apex Health will have to pay $100,000, and Geneva Re will pay $1 million.