Re: Gillam/Snader

Marybeth_Waak@STPAUL.COM
Fri, 24 Jul 1998 12:50:12 -0400

It is probably easiest to think of this in terms of numbers.
You have a $5000 loss.
If your premium is $1 million, the charge for the loss as a percentage of
your premium is (significantly) lower than if the premium were $10,000.
The larger your policy, the less significant a $5000 (or whatever size)
loss becomes.

"Paul Klauke/CorpCentre/GB/GRE-Group at GRE-GROUP KLAUKE01 - GBGRE002"
<paul_klauke@gre-group.e-mail.com> on 07/24/98 12:35:12 PM

To: studygroup9@lists.casact.org
cc: (bcc: Marybeth Waak/USFG)
Subject: Gillam/Snader

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From Paul Klauke Internal tel 723 5624
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on 24/07/98 17:28 Direct fax +44 (0) 171 696 5336

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In Gillam/Snyder I'm having trouble interpretting
'd/dE[Z/E} < 0' (top of page 4)
as
'As the size of risk increases, the percentage charge for any
loss of a given size decreases.' (bottom of page 3)
Any help?
Paul