A percentage arrived at by dividing reinsurance premium by reinsurance limit the inverse is known as the payback or amortization period. For example, a $10 million catastrophe cover with a premium of $2 million would have a rate on line of 20 percent and a payback period of five years.
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UK: A percentage arrived at by dividing reinsurance premium by the reinsurance limit, e.g. £5 million excess of loss cover with a premium of £1 million gives a rate on line of 20 per cent; the inverse, known as payback, is a period of five years. Rate on line is used to assess the adequacy of the contract rate.
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REINSURANCE: A percentage derived by dividing reinsurance premium by reinsurance limit; the inverse is known as the payback or amortization period. For example, a $10 million catastrophe cover with a premium of $2 million would have a rate on line of 20 percent and a payback period of 5 years.
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REINSURANCE: A rate of premium for a reinsurance which if applied to the liability accepted by the reinsurer will produce an annual premium sufficient to meet expected losses over a number of years.