Joint Underwriting as Reinsurance Problem, [Discussion]

Mr. Strug is to be commended for his fine effort in handling a very difficult reinsurance problem. The usual proportional reinsurance arrangement (on a coinsurance basis) is not applicable here due to the criterion that the Dental Plan maintain a contingency reserve no less than 10% (W) of its portion of the annual incurred losses on premium accounts in order to preserve a reasonably acceptable (to potential clients and state insurance examiners) financial statement position.