Cost of Losses
-
Upload
rafael-feria -
Category
Documents
-
view
220 -
download
0
Transcript of Cost of Losses
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 1/23
!"# %&'( &) *&''#' )&+ ),(,+# -#(.&+/0-1#'(2#-( 0- ("# -#. -#(.&+/' +#302#
!"##$ &'()*'+#," # $%&" '($)
*+," *$ -./%01" '$%&+," '*2$%34&356 789 :8;
7</%3= >? @ AB@C @>>C
'/D5E3= >? B?@ F@C GBA
$H65E= <,/E3D/I4%JD5&K/%;L,/H
4-(+&5,%(0&-
)<3 0IKKE9 5%;I0849 50 68 6 8I4%5%& K/5%8" M<343 8<3 N/43,608 ,/080 /N 3%34&9 &3%34685/% 643 3OK3,83;
8/ 5%,43603 H64P3;E9 D39/%; Q846;585/%6ER E3S3E0 6%; ,I443%8 H64P38 K45,30L )<3 4360/%0 N/4 8<50 643
8<433TN/E;=
•
)<3 K4/0K3,8 /N ,E5H683 ,<6%&3 <60 5%NEI3%,3; U/S34%H3%8 K/E5,530 8/ 3%,/I46&3 6 H/S3 8/43%3M6DE3 3%34&9 0/I4,30V
• )<343 50 8<3 084/%& E5P3E5<//; /N 0/H3 N/4H /N ,64D/% K45,3 5% 8<3 %364 NI8I43" M<5,< M5EE 6E0/
5%,43603 8<3 ,/080 /N 3%34&9 &3%34685/%V 6%;
• W38M/4P0 <6S3 D33% 8<3 0IDX3,8 /N 43,3%8 43&IE68/49 ;3834H5%685/%0" 8<68 N/4 H/08 <6S3
;46H685,6EE9 5%,43603; 8<354 ,6K586E 6%; /K34685%& 3OK3%;58I43 6EE/M6%,30L
)<50 K6K34 0380 /I8 6% 6KK4/6,< 8/ ;3834H5%5%& N/4M64;TE//P5%& E/%& 4I% ,/080 N/4 8<3 8<433 H65%
0IKKE9 ,<65% ,/HK/%3%80 /N 8<3 ,/08 /N E/0030=
• $%34&9 &3%34685/%V
• )<3 K4/S505/% /N %38M/4P ,6K6,589V 6%;
• )<3 K4/S505/% /N 5%,43H3%86E IK08436H E/0030L
)<3 6%6E9050 5% 8<50 43K/48 <60 K4/S5;3; 6S346&3 E/00 ,/080 D9 S/E86&3 E3S3E 6%; 50 0K3,5N5, 8/ 8<3 W+Y
43&5/% /N 8<3 2I0846E56% W685/%6E $%34&9 '64P38 -W$'1L ./M3S34" 58 K4/S5;30 6 ,E3645%;5,685/% 8<68 6
05&%5N5,6%8 ,<6%&3 5% 8<3 ,/08 /N E/0030 %/M %33;0 8/ D3 N6,8/43; 5%8/ 5%S308H3%8 6%6E9050 6,4/00 8<3
W$'L
)<3 ,/08 /N E/0030 ,6% D3 6 05&%5N5,6%8 5%KI8 8/ 8<3 KE6%%5%&" ;305&% 6%; /K34685/%6E 6,85S58530 /N
%38M/4P DI05%30030L Y<5E08 8<3 ,/08 /N E/0030 M5EE 4643E9 K4/S5;3 8<3 ,/HKE383 XI085N5,685/% N/4 6%
6I&H3%8685/% K4/X3,8" 58 ,6% ,<6%&3 8<3 43E685S3 46%P5%& /N 6E834%685S30 -K6485,IE64E9 M<3% ,/HK645%&
6I&H3%8685/% /K85/%0 M58< ;5NN343%8 S/E86&301L )<3 ,/08 /N E/0030 ,6% 6E0/ 5%NEI3%,3 8<3 K43N3443;
85H5%& /N 6% 6I&H3%8685/% K4/X3,8" M<343 H/;34683 E/6; &4/M8< K34H580 8<50L
)<3 ,/08 /N E/0030 8<I0 <60 K/83%856EE9 05&%5N5,6%8 5HKE5,685/%0 N/4 8<3 N/EE/M5%& 89K30 /N 5%S308H3%8
;3,505/%0" M<5,< 643 4/I85%3E9 H6;3 D9 846%0H5005/% 6%; ;50845DI85/% %38M/4P DI05%30030=
• )<3 ,</5,3 /N 3,/%/H5,6EE9 3NN5,53%8 6I&H3%8685/% /K85/%0" 5%,EI;5%& 8<3 ,</5,3 /N 0IKKE9
S/E86&3 E3S3EV 6%;
• :5N3,9,E3 ,/080 I03; N/4 3ZI5KH3%8 0K3,5N5,685/%0" 0I,< 60 /K85H6E I%;34&4/I%; ,6DE3 6%; E5%3
,/%;I,8/4 05[30 6%; 846%0N/4H34 ;305&%0" 643 ,4585,6EE9 ;3K3%;3%8 /% 8<50 5%KI8L
W38M/4P DI05%30030 ;/ %/8 5%,I4 8<3 ;543,8 ,/08 /N E/0030" M<5,< 643 0388E3; D38M33% 846;5%&K6485,5K6%80 5% 8<3 W$'L W/%38<3E300" 8<343 50 6 ;543,8 43ZI543H3%8 N/4 8<303 DI05%30030 8/ N6,8/4
E/00 ,/080 5%8/ 8<354 5%S308H3%8 6%6E9050" 8/ 0IKK/48 8<3 W$' /DX3,85S3 Q8/ K4/H/83 3NN5,53%8
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 2/23
@
5%S308H3%8 5%" 6%; I03 /N" 3E3,845,589 034S5,30 N/4 8<3 E/%& 834H 5%8343080 /N ,/%0IH340 /N 3E3,845,589
M58< 430K3,8 8/ K45,3 \RL
)<3 '5%5083456E #/I%,5E /% $%34&9 -'#$1 <60 ;543,83; 6 43S53M /N 8<3 W685/%6E $E3,845,589 ]IE30 -8<3
]IE301 6%; 43&IE68/49 N46H3M/4P /% ;50845DI85/% %38M/4P KE6%%5%& 6%; 3OK6%05/%" 5%,EI;5%& 8<3
43ZI543H3%80 N/4 %38M/4P 5%S308H3%8L )<3 84368H3%8 /N E/00 ,/080 5% 5%S308H3%8 6%6E9050 50 6%
5HK/486%8 N6,8/4 5% 8</03 ,/%05;34685/%0L
)<3 ,/08 /N E/0030 50 6E0/ 6 ;3834H5%5%& N6,8/4 5% 3086DE50<5%& 8<3 '5%5HIH $%34&9 734N/4H6%,3
+86%;64;0 -'$7+1" N/4 6KKE56%,30 6%; 3ZI5KH3%8 0I,< 60 ;50845DI85/% 846%0N/4H340L )<3 0K3,5N5,685/%
/N 43S503; +86&3 @ ;50845DI85/% 846%0N/4H34 '$7+ 50 ,I443%8E9 I%;34M69 60 K648 /N 8<3 2I0846E56%
U/S34%H3%80^ $ZI5KH3%8 $%34&9 $NN5,53%,9 74/&46H -$F1L )<3 ,/%0IE8685/% ]3&IE68/49 (HK6,8
+8683H3%8 -](+1 /% 43S503; ;50845DI85/% 846%0N/4H34 '$7+ 50 6M6583; 68 8<3 85H3 /N M4585%&L
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 3/23
F
6&-(#-('
4-(+&5,%(0&- 7777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 8
87 9&,-5:(0&-' )&+ ("# :-:*;'0' &) #*#%(+0%:* *&'' %&'(' 77777777777777777777777777777777777777777777777 <
=7
>-#+3; 3#-#+:(0&- %&'(' 7777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 ?
=78 @"&*#':*# #-#+3; 2:+/#( %&'(' 777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 A
=7= 9&+#%:'( #-#+3; 2:+/#( %&'(' 777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 B
=7C D,22:+; &) )&+#%:'( #-#+3; 2:+/#( %&'('77777777777777777777777777777777777777777777777777777777777777777777777 8C
C7 >-#+3; 5#*01#+; 10: ("# (+:-'20''0&- :-5 50'(+0E,(0&- -#(.&+/' 7777777777777777777 8<
C78 4-%+#2#-(:* -#(.&+/ %:F:%0(; %&'(' 7777777777777777777777777777777777777777777777777777777777777777777777777777777777 8<
C7= !+:-'20''0&- -#(.&+/ %&'(' 777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 8G
C7C H0'(+0E,(0&- -#(.&+/ %&'(' 777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 8?
<7 H0'(+0E,(0&- -#(.&+/ *&''#' 77777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 8A
I7 6&'( &) *&''#' .0("0- -#(.&+/' 7777777777777777777777777777777777777777777777777777777777777777777777777777777777777 =J
G7
6&-%*,50-3 +#2:+/' 77777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 =8
G78 K&1#2#-( 0- ("# %&'( &) *&''#' 77777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 =8
G7= H0'(+0E,(0&- (+:-')&+2#+ K>LD 7777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 =8
G7C M#3,*:(&+; :++:-3#2#-(' )&+ -#(.&+/ E,'0-#''#' 777777777777777777777777777777777777777777777777777777 =8
?7 N%/-&.*#53#2#-(777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777 =C
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 4/23
B
87 9&,-5:(0&-' )&+ ("# :-:*;'0' &) #*#%(+0%:* *&'' %&'('
(%S308H3%8 5% %38M/4P 5%N46084I,8I43 I0I6EE9 5%S/ES30 8<3 5%086EE685/% /N 6;;585/%6E /4 43KE6,3H3%8
3ZI5KH3%8 <6S5%& 6 E5N3 0K6% /N F_ 93640 /4 H/43L (8 N/EE/M0 8<68 8<3 8/86E /M%340<5K ,/08 /N 8<3
5%S308H3%8 HI08 D3 6003003; N4/H 8<3 600/,5683; ,6K586E 6%; /K34685/%6E ,/080 /S34 6 ,/HH3%0I4683
K345/;L
)<3 ,/08 /N 3E3,845,6E E/0030 N/4H0 6 ,/HK/%3%8 /N S548I6EE9 3S349 %38M/4P 5%S308H3%8" 6E8</I&< N/4
0/H3 5%S308H3%80 58 50 %/8 6 H683456E ,/HK/%3%8L (% 6;;585/%" 0/H3 %38M/4P 5%S308H3%80 643 H6;3
8/ H65%865% K430,45K85S3 %38M/4P 03,I4589 /4 43E56D5E589 ,4583456L W3S348<3E300" 8<3 ,/%05;34685/% /N
E/00 ,/080 0</IE; 6,,/HK6%9 3S349 %38M/4P 5%S308H3%8 6%; 8<354 ;3865E3; 600300H3%8 0</IE; D3
5%,/4K/4683;" M<343 8<3 E/00 ,/080 643 H683456EL
!"#$ &'# ()*$+#), -"./.
(% 3,/%/H5, 834H0" 8<3 :/%& ]I% '64&5%6E #/08 -:]'#1 /S34 8<3 K345/; /N 5%S308H3%8 6%6E9050 50 8<3
6KK4/K45683 ,/08 8/ D3 6KKE53; 8/ E/0030L (% 8<50 43K/48" 8<3 H6X/4 ,/HK/%3%80 /N 8<3 ,/08 /N E/0030
<6S3 D33% ,/%05;343; /% 8<50 D6050L
(% 43E685/% 8/ 8<3 ,/080 /N 3%34&9 &3%34685/%" 3085H6830 /N NI8I43 &3%34685/% ,/080 %33; 8/
5%,/4K/4683 8<3 5%NEI3%,3 /N 0/H3 3O834%6E58530 M<5,< 643 3OK3,83; 8/ <6S3 K/83%856EE9 05&%5N5,6%8
3NN3,80" %6H3E9 8<3 '6%;68/49 ]3%3M6DE3 $%34&9 )64&38 -']$)1 43ZI543H3%80 6%; 6 ,64D/% K45,3"
8<4/I&< 6 H3,<6%50H 0I,< 60 8<3 #64D/% 7/EEI85/% ]3;I,85/% +,<3H3 -#7]+1L
-"./ 0).+.
)<3 ,/%S3%85/% I03; 5% 8<50 43K/48 50 8<68 6EE ,/080 <6S3 D33% 3OK43003; 5% @__AT?_ 2I0846E56% ;/EE640L
Y<343 0/I4,3 H683456E N4/H /8<34 93640 M60 I03;" 8<3 ,IHIE685S3 #7( 5%;3O KIDE50<3; D9 8<3
2I0846E56% *I436I /N +8685085,0 -2*+1 M60 I03; 8/ 6;XI08 ,/080?L $085H683; ,/080 5% /8<34 ,I443%,530
M343 N5408E9 ,/%S3483; 8/ 2I0846E56% ;/EE640 I05%& 8<3 6S346&3 ,/%S3405/% 4683 6KKE5,6DE3 8/ 8<354 9364
/N 3085H685/% 6%; 8<3% 5%;3O3; 8/ @__AT?_@L
&1$+"#), 0).+.
`/4 8<3 KI4K/03 /N 8<50 6%6E9050" 8<3 W+Y 43&5/% /N 8<3 W685/%6E $%34&9 '64P38 -W$'1 <60 D33%
,</03% 6%; 5%;5,685S3 E/00 ,/080 N/4 6 H384/K/E586% -$%34&92I0846E561 6%; 6 43&5/%6E -#/I%849 $%34&91
;50845DI8/4 <6S3 D33% 3085H683;L a30K583 8<50 0,/K3 E5H58685/%" 8<3 430IE80 K4/S5;3 6 ,E364 5%;5,685/%
/N ,<6%&3; ,/%;585/%0 8<68 6KKE9 6,4/00 8<3 W$'" 6ED358 M58< 0/H3 43&5/%6E 6%; ;50845DI8/4 0K3,5N5,
S645685/%0L
2"3,")4 ,".. )#4 ,")4 ,"..
)<3 E/0030 8<68 643 600/,5683; M58< 8<3 /K34685/% /N 3E3,845,6E 3ZI5KH3%8 %33; 8/ D3 ,/%05;343; 5%8M/ 03K64683 ,683&/4530 D3,6I03 /N 8<354 ;5NN345%& 5HK6,8 /% 8<3 K/M34 09083H" 60 N/EE/M0=
• W/TE/6; -/4 0<I%81 E/00 50 6 43E685S3E9 ,/%086%8 E36P6&3 E/00" M<5,< 50 5%;3K3%;3%8 /N 8<3
3ZI5KH3%8 E/6;5%& 6%; 86P30 KE6,3 M<3%3S34 8<3 3ZI5KH3%8 50 3%34&503;V 6%;
• :/6; -/4 0345301 E/00 ;3K3%;0 IK/% 8<3 3E3,845,6E E/6; 0IKKE53; D9 8<3 3ZI5KH3%8L )<3 E/6;
E/0030 S649 M58< 8<3 0ZI643 /N 8<3 E/6; ,I443%8 5HK/03; /% 8<3 3ZI5KH3%8L
? 2I0846E56% *I436I /N +8685085,0" >B_?L_ T #/%0IH34 745,3 (%;3O" 2I0846E56T Y35&<83; 6S346&3 /N 35&<8
,6K586E ,58530" @b c6%I649 @_?_L
@ ]3034S3 *6%P /N 2I0846E56" `?? $O,<6%&3 46830" A a3,3HD34 @__AL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 5/23
G
`5&I43 ? 5EEI0846830 8<3 <6ENT</I4E9 ;3H6%; 600/,5683; M58< E/6; 6%; %/TE/6; E/0030" ,/HK643; M58<
8<3 ;3H6%; K4/N5E3 /N 8<3 6S346&3 09083H E/6; 5% 8<3 W+Y 43&5/% /N 8<3 W$' N/4 8<3 9364 @__Cd_AFL
)<3 8<433 E/6; 6%; E/00 K4/N5E30 643 0,6E3; N/4 6 %/4H6E503; ,/%0IHK85/% /N ? 'Y< K34 6%%IHL )<3
DEI3 846,3 43K4303%80 8<3 09083H E/6;" 8<3 ,/%086%8 DE6,P 846,3 8<3 %/TE/6; E/00 K4/N5E3 6%; 8<3 43;
846,3 8<3 E/6; E/00 K4/N5E3L )<50 5EEI084685/% 034S30 8/ <5&<E5&<8 </M 8<303 S349 ;5NN343%8 E/6; K4/N5E30
6NN3,8 8<3 K36P K345/; ;3H6%;" M58< 6 ,/%086%8 ZI6%8IH /N ;3E5S343; 3%34&9L )<3 6%%I6E E/6;;I4685/% ,I4S30 68 45&<8 NI48<34 <5&<E5&<8 8<3 ,/HK6450/%L
903,+# 8 O L+&)0*# &) ';'(#2 5#2:-5 :-5 *&''#'
(% 8<3 ,<648 68 E3N8" M<5,< 0<6430 8<3 06H3 9 6O50" 8<3 E/6; K4/N5E3 ;50KE690 8<3 0360/%6E 6%; M33PE9
S645685/% 600/,5683; M58< 3E3,845,589 ,/%0IH3;L 28 45&<8" 8<3 06H3 </I4E9 5%N/4H685/% 50 43/4;343; 8/
;50KE69 8<3 E/6; ;I4685/% ,I4S3 600/,5683; M58< 8<3 ;5NN343%8 ,/%0IHK85/% K4/N5E30L
(8 N/EE/M0 8<68 5% 3S6EI685%& 8<3 ,/08 /N E/0030 N/4 5%S308H3%8 6%6E9050" 8<3 ,/%05;34685/% 6%; 03K64683
,/085%& /N 8<354 8M/ ,/HK/%3%80" E/6; 6%; %/TE/6; E/0030" 50 %3,300649L )<354 S349 ;5NN343%8
,/%0IHK85/% K4/N5E30 6%; 5%NEI3%,3 /% K36P ;3H6%; 6NN3,8 8<3 ,/08 /N D/8< 3%34&9 &3%34685/% 6%; /N
%38M/4P ;3E5S349L
-"56"#1#/. "7 /81 9"./ "7 41,+:1*14 1#1*$;
)<3 084I,8I43 /N 8<3 2I0846E56% W$' 6%; 8<3 ;506&&43&683; 3%858530 5% 8<3 0IKKE9 ,<65% 643 5EEI084683;
5% `5&I43 @L (% 8<50 5EEI084685/%" 8<3 H64P38 0388E3H3%80 6446%&3H3%8 N/4 3%34&9 ;3E5S343; 8/ 6 K/5%8 5%
8<3 ;50845DI85/% %38M/4P 50 0</M%L
:/0030 M58<5% 8<3 846%0H5005/% %38M/4P 643 6,,/I%83; N/4 M58< 846%0H5005/% E/00 N6,8/4 6;XI08H3%80"
M<5,< 6KKE9 8/ 8<3 K45,30 68 6EE ,/%%3,85/% K/5%80 8/ 8<3 846%0H5005/% %38M/4PL )<303 643 H64&5%6E
N6,8/40 8<68 6;XI08 8<3 43&5/%6E 43N343%,3 K45,3 -]]71L (% H/08" DI8 %/8 6EE" ,6030" 8<3 K45,3 K65; 8/
&3%3468/40 50 E300 8<6% 8<3 ]]7 6%; 8<3 K45,3 K65; D9 43865E340 68 E/6; ,/%%3,85/% K/5%80 50 &436834
8<6% 8<3 ]]7L
F W$' ,/%0IHK85/% 6%; K45,3 ;686 50 6S65E6DE3 N4/H 8<3 2$'e M3D 0583 68
<88K=ddMMML63H/L,/HL6Id;686dK45,3f;3H6%;L<8HE L
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 6/23
>
a50845DI85/% E/00 N6,8/40 6,8 60 S/EIH3 6;XI08H3%80 N4/H 8<3 K/5%8 5% 8<3 %38M/4P M<343 E/6; 50
,/%%3,83; 8/ 8<3 43E3S6%8 846%0H5005/% ,/%%3,85/% K/5%8L a50845DI85/% E/00 N6,8/40 643 6S346&3
ZI6%858530 M<5,< 5%,43H3%8 8<3 E/6; D9 8<3 E/0030 M58<5% 8<68 %38M/4PL
903,+# = P K:+/#( '#((*#2#-(' 0- ("# Q>K
Y<5E08 846%0H5005/% E/00 N6,8/40 6,8 60 K45,3 HIE85KE5340 6%; ;50845DI85/% E/00 N6,8/40 6,8 60 S/EIH3
HIE85KE5340 5% 8<3 H64P38 0388E3H3%80" 8<3 ,/08 /I8,/H3 /N 0388E3H3%80 N/4 E/6; 0IKKE53; 8/ 8<3
;50845DI85/% %38M/4P 50 8<3 HIE85KE3 /N 6EE IK08436H E/00 N6,8/40" 8<3 &3%3468/4 K45,3 6%; 8<3 S/EIH3L
)<I0 N/4 6 E/6; g : ,/%%3,83; 5% 8<3 ;50845DI85/% 09083H=
U3%3468/4 D5; K45,3 h7U
745,3 /N 3%34&9 68 H64P38 ]]W 7]]W i h7Uj):`U
745,3 /N 3%34&9 KI4,<603; N4/H H64P38 68846%0H5005/% ,/%%3,85/% K/5%8
7)#7 i 7]]Wj):`:
i h7Uj):`Uj):`:
k/EIH3 /N 3%34&9 KI4,<603; N4/H H64P38 68
846%0H5005/% ,/%%3,85/% K/5%8
g )#7 i g :ja:`:
#/08 /N 3%34&9 ;3E5S343; 8/ ;50845DI85/% 09083H #/08 i 7)#7jg )#7
i h7Uj ):`Uj):`:j g :ja:`:
)46%0H5005/% 6%; ;50845DI85/% ,/080 6E0/ %33; 8/ D3 6;;3; 8/ 8<3 ,/08 /N 3%34&9 ;3E5S343; M58<5% 8<3
;50845DI85/% %38M/4PL )<3 )46%0H5005/% 6%; a50845DI85/% l03 /N +9083H -)l/+ 6%; al/+1 ,/080 643 6EE
IE85H683E9 43,/S343; N4/H ,I08/H340L
)<303 3E3H3%80 86P3% 8/&38<34 H6P3 IK 8<3 ,/08 /N ;3E5S343; 3%34&9 -/4 /N E/08 3%34&91 6%; 643;30,45D3; 5% `5&I43 FL
!"#$%&'%%'($
$)*+(",
!"#$
-'%*"'./*'($
$)*+(",
%&'()*+,
%&-&.&*/& 1)2&!"#"
!.+*34(33()*
5)**&/6()*
7)(*6
8"#"
!"# 9 !.+*34(33()* ")33 #+/6).8"# 9 8(36.(:;6()* ")33 #+/6).
-'%*"'./*'($
$)*+(",
< "")33 ). ,)+2 "
< "=8"#">7$
>7$=!"#$
>7$=!"#$=!"#"
>7$=< "=!"#$=!"#"=8"#"
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 7/23
b
903,+# C P 6&2F&-#-(' &) ("# %&'( &) 5#*01#+#5 #-#+3;
-),)#"./', $%34&9 50 ;3E5S343; 8/ 8<3 H64P38 N4/H 8<303
E/,685/%0L U3%3468/4 D5;0 %33; 8/ ,/S34 8<3 N5O3;
6%; S6456DE3 ,/080 /N 3%34&9 K4/;I,85/%" KEI0
846%0H5005/% ,/080 6%; 846%0H5005/% E/0030 5%,I443;
5% ;3E5S349 8/ 8<3 H64P38L
0#",12/11/', ,).3'#4
)46%0H5005/% E/00 )46%0H5005/% E/0030 6;XI08 8<3 &3%3468/4 D5; K45,3L
)46%0H5005/% ,/08 -)l/+1 2 H5%/4 ,/HK/%3%8 /N 846%0H5005/% ,/08 50 E3S53;
/% &3%3468/40 6%; 43,/S343; 8<4/I&< 8<354 H64P38
D5;0L
5"./',"( 6,)#7$ 8"#4).
-W$'1
$%34&9 50 0388E3; /% 6 <6EN </I4E9 D6050 5% 8<3
H64P38 68 8<3 ]3&5/%6E ]3N343%,3 W/;3 -]]W1L
0#",12/11/', ,).3'#4
)46%0H5005/% E/00 )46%0H5005/% E/0030 6;XI08 8<3 H64P38 KI4,<603
K45,3 68 8<3 846%0H5005/% D/I%;649L
)46%0H5005/% ,/08 -)l/+1 )<3 H6X/4 ,/HK/%3%8 /N 846%0H5005/% ,/08 6;;0 8/
8<3 ,/08 /N ;3E5S343; 3%34&9L
0#",12/11/', 9 :/1.#/*+./',
*'+,;"#$
Y</E306E3 3%34&9 50 KI4,<603; N4/H 8<3 H64P38 68
8<50 5%834N6,3L
:/1.#/*+./', ,).3'#4
a50845DI85/% E/00 a50845DI85/% E/0030 6;XI08 8<3 S/EIH3 /N 3%34&9
8<68 HI08 D3 KI4,<603; N4/H 8<3 H64P38L
a50845DI85/% ,/08 -al/+1 a50845DI85/% ,/080 6;; 8/ 8<3 ,/08 /N ;3E5S343;
3%34&9L
$%34&9 ,/%0IH3; 68 6 K/5%8 M58<5% 6 ;50845DI85/% %38M/4P 6NN3,80 36,< 3E3H3%8 /N 8<3 IK08436H
3%34&9 0IKKE9 ,<65%" 5%,43605%& D/8<=
•
)<3 ZI6%8IH /N 3%34&9 43ZI543;V 6%;
• )<3 ,/08 /N 3%34&9 ;3E5S343; 8/ 8<68 K/5%8L
$6,< /N 8<303 ,/HK/%3%8 ,/080 50 %/M ,/%05;343; 5% 8I4%L
=7 >-#+3; 3#-#+:(0&- %&'('
`/4 8<3 KI4K/03 /N ,/HK6450/%" 8M/ 0/I4,30 /N &3%34685/% ,/08 <6S3 D33% ,/%05;343;=
• Y</E306E3 3%34&9 H64P38 43E683; ,/080" N4/H @__Cd_AV 6%;
• `/4M64; E//P5%& &3%34685/% ,/080" I05%& 8<3 H/08 43,3%8E9 6S65E6DE3 3085H6830 /N 6E834%685S3
&3%34685/% 83,<%/E/&530L
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 8/23
C
=78 @"&*#':*# #-#+3; 2:+/#( %&'('
)<3 H/08 43,3%8 NIEE 9364 /N M</E306E3 H64P38 ;686" N/4 @__Cd_A" K4/S5;30 8<3 6,8I6E ,/08 /N E/0030
8<68 M/IE; <6S3 D33% 5%,I443; 5% 8<68 9364" 68 8<3 E3S3E /N 8<3 ]]WL )<3 <6ENT</I4E9 ]3&5/%6E
]3N343%,3 745,3 -]]71 /4 K//E K45,3 S6453; 8<4/I&</I8 6 &4368 46%&3 ;I45%& 8<3 9364" N4/H 6
H6O5HIH ,6KK3; 68 h?_"___" 8/ 6 H5%5HIH /N Th?_GL?GL
(% `5&I43 B" 8<3 H6O5HIH 6%; H5%5HIH ;65E9 S6EI30 /N 8<3 ]]7 <6S3 D33% 0</M% 5% 8<3 E3N8 <6%; D64
,<648L W3&685S3 K45,30 M343 3O,EI;3; 8/ 3%6DE3 6 E/&6458<H5, S3485,6E 0,6E3" %3,300649 8/ ,/HK4300
3O843H3 K//E K45,3 3O,I405/%0L
)<343 50 6 4360/%6DE3 ,/443E685/% D38M33% 8<3 ]]7 6%; 8<3 W+Y 43&5/% ;3H6%;" 60 3S5;3%,3; D9 8<3
]@ S6EI3 /N 8<3 0,68834 KE/8 68 45&<8L .343" 6% 3OK/%3%856E D308TN58 846X3,8/49 6KK3640 60 6 08465&<8 E5%3
M58< 8<3 E/&6458<H5, 0,6E3L )<3 8M/ ,<6480 <6S3 8<3 06H3 S3485,6E 0,6E3L
903,+# < P L&&* F+0%# :-5 +#30&-:* 5#2:-5 )&+ QD@R =JJASJB
2%6E9050 /N 8<3 <6EN </I4E9 0388E3H3%80 ;686 N/4 8<3 9364 8/ ;3834H5%3 8<3 ,/08 /N E/0030 50 ,64453; /I8
5% 8<433 M690=
?L 2 05HKE3 6S346&3 /N 8<3 ]]7L )<50 M/IE; ,/4430K/%; M58< 8<3 6S346&3 M</E306E3 ,/08 /N
3%34&9 0IKKE53; 8/ 6 ,/%086%8 E/6; -/4 %/TE/6; E/001V
@L 2 E/6; M35&<83; 6S346&3 /N 8<3 ]]7" 43K4303%83; D9 8<3 N/EE/M5%& N/4HIE6=
Y<343=
""#$ 50 8<3 ]]7 N/4 <6EN </I4 $V 6%;
%$ 50 8<3 ]3&5/%6E a3H6%; 0IKKE53; D9 8<3 H64P38 5% <6EN </I4 $L
)<3 E/6; M35&<83; 6S346&3 K45,3 50 8<3 M</E306E3 ,/08 /N 0IKKE95%& 6 E/6; M58< 8<3 06H3
K4/N5E3 60 8<3 09083H 6S346&3V 6%;
FL
2 E/6;T0ZI643; 6S346&3 /N 8<3 ]]7" 43K4303%83; D9 8<3 N/EE/M5%& N/4HIE6=
P1 =
RRPn
• Dnn=1
17,520
" D
nn=1
17,520
"
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 9/23
A
)<3 6S346&3 K45,3 0/ ,6E,IE683; 50 8<3 M</E306E3 ,/08 /N 0IKKE95%& 6 E/6; M58< 8<3 06H3
K4/N5E3 60 8<3 E/6; E/0030 5%,I443; 5% 0IKKE95%& 6 E/6; M58< 8<3 09083H 6S346&3 K4/N5E3 -05%,38<3 E/6; E/00 50 K4/K/485/%6E 8/ 8<3 0ZI643 /N 8<3 E/6;1L
)<303 6S346&3 M</E306E3 ,/080" 5%;3O3; 8/ h@__Ad?_" 643 038 /I8 5% )6DE3 ?L
!:E*# 8 P @"&*#':*# #-#+3; %&'(' &) ',FF*;R =JJASJB
<'"; =#'>/() 5'9('"; ('11 ?$1.)2 ('"; <'"; ('11
Y</E306E3 ,/08 /N 0IKKE9 hFALC_ hBFLC_ hBCLB_
)<3 ,/443E685/% D38M33% 8<3 ]]7 6%; 8<3 43&5/%6E ;3H6%; H69 D3 033% 60 6% 5%,43603; ,/08
600/,5683; M58< 8<3 0IKKE9 /N 3%34&9 8/ 6 H/43 mK36P9^ E/6; K4/N5E3L
=7= 9&+#%:'( #-#+3; 2:+/#( %&'('
)<3 M</E306E3 K45,30 /N 03,85/% @L? 643 8<3 /I8,/H3 /N H64P38 0388E3H3%80" 5% M<5,< 8<3 &3%3468/4
D5;0 6%; 600/,5683; ,/%846,80 M58< 43865E340 43,/S34 8<354 ,/080L )<3 ,/08 /N 3%34&9 ;3E5S343; 8/ 8<3
H64P38 5%,EI;30 8<3 N/EE/M5%& ,/HK/%3%80=
• $%34&9 K4/;I,85/%V
• )46%0H5005/% %38M/4P E/0030V 6%;
• )46%0H5005/% %38M/4P ,<64&30L
$6,< /N 8<303 ,/HK/%3%80 50 ,/%05;343; 5% 8I4%" 8/ ;3S3E/K 6 N/43,608 /N NI8I43 3%34&9 ,/080L
<1#1*)/+"# 9"./.
)<3 H/08 43,3%8E9 6S65E6DE3 N/4M64;TE//P5%& &3%34685/% ,/08 5%N/4H685/% 50 ,/%865%3; 5% 8<3
2I0846E56% $%34&9 '64P38 eK3468/4^0 -2$'e1 @__A &3%34685/% ,/08 43S53MBL 2#(: )60H6% M60
3%&6&3; 8/ ;3S3E/K 8<50 ;686 N/4 8<3 K45H649 KI4K/03 /N ,/%;I,85%& H64P38 05HIE685/% 08I;530L
)<303 08I;530 M343 I%;3486P3% 8/ 5;3%85N9 8<3 43ZI543H3%8 N/4 6;;585/%6E 846%0H5005/% 5%N46084I,8I43
5% 8<3 W$'" &5S3% K4/X3,83; &3%34685/% 3OK6%05/% 0,3%645/0L
2#(: )60H6% ;3S3E/K3; +</48 6%; :/%& ]I% &3%34685/% ,/08 N/43,6080 N/4 6 46%&3 /N NI8I43
&3%34685%& 83,<%/E/&530" M58< E/,685/%6E S645685/%0 N/4 ?> 43&5/%6E [/%30 6,4/00 8<3 W$'L )<3 ,/080
M343 3085H683; /S34 6 K345/; 3O83%;5%& 8/ @_@CT@AL (% 8<50 43K/48" 8<303 ,/080 <6S3 D33%
0IHH64503; 60 6S346&30 /S34 8<3 N/I4 [/%30 ,/S345%& W+Y 6%; 8<3 2#)L 2E8</I&< 8<343 50 %/8 6
&4368 ;36E /N ,/08 S645685/% 6N834 8<3 5%84/;I,85/% /N 8<3 #7]+" 6 H5;T46%&3 ;683 /N @_?AT@_ N/4 %3M
&3%34685/% M60 ,</03% N/4 8<50 ,/HK6450/%L
)<3 5%N/4H685/% 5% 8<3 2#(: )60H6% 43K/48 K34865%0 8/ 8</03 &3%34685/% 83,<%/E/&530 8<68 ,6% D3
;50K68,<3; 5% 8<3 H64P38L (8 8<I0 ;/30 %/8 5%,EI;3 0/H3 N/4H0 /N 43%3M6DE3 &3%34685/%" %/86DE9
M5%; 6%; 0/E64L 2% 6E834%685S3 43,3%8 2I0846E56% 0/I4,3 /N 5%N/4H685/% /% 8</03 ,/080 50 ',:3%%6%
B 2#(: )60H6%" ̀ 5%6E ]3K/48 ̀ I3E 430/I4,3" %3M 3%849 6%; &3%34685/% ,/080 5% 8<3 W$' 743K643; N/4 8<3
(%834T]3&5/%6E 7E6%%5%& #/HH58833" 2K45E @__AL
P2 =
RRPn• D
n
2
n=1
17,520
"
Dn
2
n=1
17,520
"
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 10/23
?_
'6&606%5P 6%; 200/,56830^ -''21 43K/48 K43K643; N/4 8<3 2I0846E56% U3/8<34H6E $%34&9
200/,5685/%GL
)<3 ,/080 /N %3M 83,<%/E/&9 &3%34685/% 643 0IHH64503; 5% )6DE3 @L
!:E*# = P TMK6 &) -#. 3#-#+:(0&- (#%"-&*&30#' 0-(+&5,%#5 0- =J=J
0)@A,'('7$ &"="@/.$ >"@.'# <B8& )C@(+;/,7 &DB?
hd'Y< &3%34683;
<B8& /,@(+;/,7 &DB?E
hd'Y< &3%34683;
##U) CGn hGb hbBb
e#U) ?GnC h?G> h?CFb
#/6E CGn hBC hbbb
U3/8<34H6E CGn hbC hbCb
2;S6%,3; ,/6E CGn h>b hbAb
WI,E364 CGn hAC hACb
Y5%; F_nA h?_G h?_G?_
*5/H600 CGn?? h??F h??F?_
:64&3 0/E64 F_n??
h@>C h@>C?_
+H6EE 0/E64 K</8/S/E865, @_n?? hG@@ hG@@?_
o39= ##U) i #/HD5%3; ,9,E3 &60 8I4D5%3V e#U) i eK3% ,9,E3 &60 8I4D5%3V 2;S6%,3; ,/6E i lE846T
0IK34,4585,6E ,/6E 6%; (%83&4683; &605N5,685/% ,/HD5%3; ,9,E3V :64&3 0/E64 i 0/E64 ,/EE3,8/4 /4
0/E64 8<34H6EV +H6EE 0/E64 i 4//N8/K 0/E64 K</8/S/E865,L
(8 50 N3605DE3 8/ 05HKE5N9 8<50 46%&3 /N NI8I43 %3M &3%34685%& 83,<%/E/&530 0/H3M<68" N/4 8<3 KI4K/030
/N 8<3 6%6E9050 5% 8<50 43K/48L )<3 3O5085%&" ,/HH5883; 6%; K4/K/03; &3%34685/% ,6K6,589 N/43,608 5%
8<3 2$'e 08683H3%8 /N eKK/48I%58530" M<5,< ,/S340 8<3 K345/; 8/ @_?A" M60 I03;?@L )<3 N/EE/M5%&
05HKE5N5,685/%0 <6S3 D33% H6;3=
• 2$'e ;/30 %/8 6%85,5K683 6%9 %I,E364 /4 &3/8<34H6E ,/%845DI85/% 5% W+Y D9 @_?A 6%; 8<303
83,<%/E/&530 <6S3 8<343N/43 D33% 3O,EI;3;V
G ',:3%%6% '6&606%5P 6%; 200/,56830L ]3K/48 8/ 2U$2 -2I0846E56% U3/8<34H6E $%34&9 200/,5685/%1 T
#/HK64685S3 #/080 /N $E3,845,589 U3%34685/% )3,<%/E/&530" ̀ 3D4I649 @__AL
> 200IH30 ,64D/% K45,30 60 K34 )4360I49^0 #7]+ TG 0,3%645/L
b
2#(: )60H6%" 2K45E @__A" )6DE3 G@ 6%; )6DE3 GFLC )<3 2#(: )60H6% ,/08 3085H6830 <6S3 D33% K43K643; M58< 6 I%5N/4H CGn ,6K6,589 N6,8/4L )<50 50 %/8 6
436E5085, 600IHK85/% N/4 8<3 /K34685%& 43&5H3 /N 8<50 N/4H /N &3%34685/%" M<5,< <60 6 43E685S3E9 <5&< NI3E
,/08L 2% 6;XI08H3%8 <60 D33% H6;3 8/ 8<3 :]'# 8/ 43,/S34 8<3 ,6K586E ,/HK/%3%8 /S34 6 H/43 89K5,6E
,6K6,589 N6,8/4L Y<5E08 e#U) N6,5E58530 643 /N83% ;305&%3; N/4 ,6K6,589 N6,8/40 /N F_n" 8<354 I85E50685/% 5%
W+Y 50 H/43 E5P3E9 8/ N6EE 5% 8<3 46%&3 /N ?_ 8/ ?Gn 8/ H338 8<3 W+Y 43ZI543H3%8 N/4 K36P5%& &3%34685/%"
<5&<E5&<83; D9 8<3 E/6; ;I4685/% 5% `5&I43 GL
A ''2" `3D4I649 @__A" KL@ -600IH3; 8/ E53 68 8<3 E/M34 3%; /N 8<3 46%&3 /N @Cn 8/ BFn1L
?_ ''2" `3D4I649 @__A" )6DE3 FT?L
?? $%34&9 (%N/4H685/% 2;H5%5084685/% T ]3K/48 p=ae$d$(2T_GGB-@__A1 T 200IHK85/%0 8/ 8<3 2%%I6E $%34&9
eI8E//P @__A" '64,< @__A" )6DE3 ?FL@L
?@ 2I0846E56% $%34&9 '64P38 eK3468/4" @__A" $E3,845,589 +8683H3%8 /N eKK/48I%58530" #<6K834 BL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 11/23
??
• )<3 ,/08 /N 3%34&9 &3%34683; N4/H ,/6E 6%; 6;S6%,3; ,/6E 50 S349 05H5E64L )<3 ,/08 /N ,/6E
<60 D33% I03;V
• Y5%;" D5/H600" &3/8<34H6E 6%; E64&3 0/E64 &3%34685/% 0/I4,30 643 I%0,<3;IE3;L '/43/S34"
8<3 6%85,5K683; ,/%845DI85/% /N D/8< D5/H600 6%; 0/E64 50 43E685S3E9 0H6EEL )<39 <6S3 D33%
8<343N/43 D33% &4/IK3; 8/&38<34 6%; 8<354 M35&<83; 6S346&3 ,/08 I03;V 6%;
• +H6EET0,6E3 4//N8/K 0/E64 K</8/S/E865, 50 8<3 H/08 3OK3%05S3 /N 8<3 3%34&9 &3%34685/% /K85/%0
6%; 580 43,3%8E9 5%,43603; K3%384685/% <60 D33% 60 6 430IE8 /N 0ID05;530 N/4 8<3 5%086EE685/% /N
I%580 /N ?LG PY /4 E300" ]3%3M6DE3 $%34&9 #3485N5,683 -]$#1 3%858E3H3%80 6%; XI450;5,85/%6E
0/E64 N33;T5% 8645NN0?F"?B
L )<50 N/4H /N 3%34&9 &3%34685/% 50 %/8 0388E3; 5% 8<3 H64P38 6%; <60
D33% 3O,EI;3; /% 8<3 D6050 8<68 58 M/IE; D3 5%,/4K/4683; 5%8/ 2$'e^0 3%34&9 6%; ;3H6%;
K4/X3,85/%0 D9 D35%& %3883; /NN ,I08/H34 ;3H6%; 6%; 3%34&9L
=*)#.5+..+"# #1/>"*? ,"..1. 7"* $1#1*)/"*.
)<3 ,6K6,589TD603; 6S346&3 /N 2$'e^0 @__Ad?_ H64&5%6E E/00 N6,8/40 N/4 H6X/4 W+Y &3%3468/40 50
_LA>GA?G
L )<68 50" /% 6S346&3 8<303 &3%3468/40 E/03 6KK4/O5H683E9 FLGn /N 43S3%I3 ;345S3; 8<4/I&<
H64P38 0388E3H3%80" ;I3 8/ 8<3 6KKE5,685/% /N H64&5%6E 846%0H5005/% E/00 N6,8/40L
(8 <60 D33% 600IH3; 8<68 8<3 H6X/4589 /N %3M &3%34685/% 83,<%/E/&530 643 E5P3E9 8/ D3 E/,683; 68
3O5085%& &3%34685/% 05830 /4 05H5E64E9 E/,683; 05830L )<3 ;3E5S343; ,/08 /N 3%34&9 8/ 8<3 H64P38 M/IE;
8<343N/43 ,6449 8<50 FLGn H64PTIKL
Y5%; &3%34685/% 50 H/08 E5P3E9 8/ D3 E/,683; 5% 43H/83 E/,685/%0" M58< 358<34 846%0H5005/% /4 <5&<
,6K6,589 ;50845DI85/% ,/%%3,85/%0 8/ 8<3 5%834,/%%3,83; %38M/4P 6%; E/6; ,3%8430L `/4 8<50 4360/%"
6% 6;;585/%6E E/00 /N Gn <60 D33% 600IH3; N/4 8<50 N/4H /N &3%34685/%L
=*)#.5+..+"# #1/>"*? 9"./. 7"* $1#1*)/"*.
)<3 3O5085%& H6X/4 &3%3468/40 5% W+Y K69 6 0H6EE ,/HK/%3%8 /N )46%0H5005/% l03 /N +9083H -)l/+18/ )46%0U45; N/4 8<354 ;3;5,683; ,/%%3,85/% 600380?>L )<50 ,/08 <60 D33% 6S346&3; /S34 8<3 3%34&9
;3E5S343; 8/ 8<3 &45; D9 K/M34 08685/%0" 8/ /D865% 6 hd'Y< ,/%%3,85/% ,/08?bL
)<50 846%0H5005/% ,/08 <60 D33% 600IH3; 8/ 6KKE9 8/ 05H5E64E9 E/,683; %3M &3%3468/40" 6&65% M58< 8<3
3O,3K85/% /N M5%;L (% 8<3 ,603 /N M5%; &3%3468/40 6% 6;;585/%6E 846%0H5005/% ,<64&3" 3ZI5S6E3%8 8/
6% 5%S308H3%8 /N h@_ H5EE5/% 5% 6 ;3;5,683; 846%0H5005/% ,/%%3,85/% N/4 36,< ?__ 'Y /N &3%34685/%
M60 6;;3;L
@'55)*; "7 /81 7"*19)./ 9"./ "7 1#1*$; $1#1*)/+"#
2 0IHH649 /N 8<3 ,/08 /N 3%34&9 ;3E5S343; 8/ 8<3 H64P38 ]]W N/4 8<3 6E834%685S3 &3%34685/%
83,<%/E/&530 50 038 /I8 5% )6DE3 FL
?F ',:3%%6% '6&606%5P 6%; 200/,56830L ]3K/48 8/ a3K648H3%8 /N #E5H683 #<6%&3 T *3%3N580 6%; #/080 /N 8<3
$OK6%;3; ]3%3M6DE3 $%34&9 )64&38" c6%I649 @__A" KLF_L
?B o7'U" W$''#e :8; T +86&3 8<433 T +3H5T0,<3;IE3;" W/%T0,<3;IE3; 6%; $O3HK83; U3%34685/%" D9 NI3E
0/I4,3 5% W$' 43&5/%0 @__CTA 8/ @_@CT@A T `5%6E ]3K/48" '64,< @__AL
?G W$''#e -%/M 2$'e1" :508 /N ]3&5/%6E */I%;64530 6%; '64&5%6E :/00 `6,8/40 N/4 8<3 @__Ad?_ 5̀%6%,56E
q364 T k3405/% W/L @L_ T `5%6E" F_ 2K45E @__AL
?> )46%0U45;" )46%0U45;r0 )46%0H5005/% 745,30 T ? cIE9 @__A 8/ F_ cI%3 @_?_" ?B '69 @__AL
?b )46%0U45;" W3M +/I8< Y6E30 2%%I6E 7E6%%5%& ]3K/48" F_ cI%3 @__A" )6DE3 2FL?" KLbCL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 12/23
?@
!:E*# C P 9&+#%:'( %&'( &) 3#-#+:(0&- 5#*01#+#5 (& ("# M#30&-:* M#)#+#-%# Q&5#
0)@A,'('7$ &"="@/.$
>"@.'#
<B8& /,@(F &DB?
hd'Y< &3%34683;
<'11 &'1.
hd'Y<
0G'?
hd'Y<
0'."(
hd'Y< ;3E5S343;
##U) CGn hbB h@L>_ h_LF_ hbb
e#U) ?Gn h?CF
h>LG_ h_LF_ h?A_
#/6E CGn hbC h@Lb_ h_LF_ hC?
Y5%; s I%0,<3;IE3; F_n h?_G T?C
hAL@_ h??B
=81 7"*19)./ 5+A "7 1A+./+#$ )#4 #1> $1#1*)/+"# /;61.
(% /4;34 8/ N/43,608 8<3 ,/08 /N 3%34&9 0IKKE9 8/ E/6;0 /N ;5NN343%8 K4/N5E3" 58 50 %3,300649 8/ ,/%05;34
8<3 M69 5% M<5,< 8<3 ;5NN343%8 3%34&9 0/I4,30 M58< ;5NN343%8 ,/080 6%; ,6K6,589 N6,8/40 643 E5P3E9 8/
D3 ;30K68,<3; N/4 /K34685/% 5% 8<3 W$'L )<3 W+Y K4/N5E3 N/4 @__Ad_A M60 I03; 8/ ;3S3E/K 8<3
&3%3468/4 H5OL )<50 K4/N5E3 <6; 6 H6O5HIH <6ENT</I4E9 ;3H6%; /N ?B"?G@ 'YL )<3 K4/N5E3 M60
0,6E3; 8/ ?>"CG_ 'Y 5% @_?AT@_" 8/ H68,< 8<3 N/43,608 0IHH34 ;3H6%; &4/M8< /N @L?n /S34 8<3K345/;
?AL
)<3 ,6K6,589 /N 3O5085%&" ,/HH5883; 6%; K4/K/03; &3%34685/% 5% W+Y M60 86P3% N4/H 2$'e^0
+8683H3%8 /N eKK/48I%58530L )<50 50 0IHH64503; D9 &3%3468/4 89K3" 5% )6DE3 B@_
L
!:E*# < P >U0'(0-3R %&220((#5 :-5 F+&F&'#5 3#-#+:(0&- 0- QD@
0)@A,'('7$ 8HI ?+22)#
?@A);+(); ",; 1)2/91@A);+(); G,1@A);+();
##U) ?"BG@ _
#/6E ?B"C>G _
e#U) F"AF_ @>F
*5/H600 _ @?B
.9;4/ @"BF> ?A_
Y5%; @"@G_ @?B
)/86E @B"AFF CC?
*603; /% 8<3 6D/S3 600IHK85/%0" `5&I43 G 5EEI0846830 8<3 E5P3E9 H5O /N 8<3 89K30 /N &3%34685/%
;30,45D3; 5% 03,85/% _" M58< 8<3 6;;585/% /N 8<3 3O5085%& <9;4/ 08685/%0 -K45%,5K6EE9 +%/M91L +%/M9
.9;4/ <60 5%086EE3; ,6K6,589 /N F"bB> 'Y 6%; 6%%I6E 6S346&3 &3%34685/% /N B"G__ UY<" M<5,<
3ZI6830 8/ 6% 6%%I6E ,6K6,589 N6,8/4 /N 64/I%; ?Bn@?L (80 K45,3 M60 038 3ZI6E 8/ e#U) 60 58 K4/S5;30
05H5E64 3,/%/H5, S6EI3 8/ 8<3 H64P38L
?C )<3 ,/08 /N 846%0H5005/% E/0030 50 5%,EI;3; 5% 8<3 :]'# 3085H683 D9 ''2L
?A )46%0U45;" W3M +/I8< Y6E30 2%%I6E 7E6%%5%& ]3K/48 @__A" )6DE3 FL@" KLbAL
@_ 2$'e @__A $+/e" #<6K834 B" )6DE30 BLG" BL>" BL?b T BL@_" KKLBT?_ 8/ BTFCL
@? (%83EE5&3%8 $%34&9 +9083H0" (%05;34" F? '64,< @__>" KL@L
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 13/23
?F
903,+# I P 9&+#%:'( 20U &) #U0'(0-3 :-5 -#. 3#-#+:(0&- E; =J=J
Y5%; 6%; I%0,<3;IE3; &3%34685/% M60 600IH3; /K34683 M58< 8<3 K36P ;3H6%; 6%; ,6K6,589 N6,8/4
600IH3; 5% 2$'e^0 @__A +8683H3%8 /N eKK/48I%58530L )<3 ,/5%,5;3%8 43;I,85/% 5% K36P ;3H6%; 50
GB_ 'Y" 6%; 8<3 43;I,85/% 5% 3%34&9 ?G__ UY<" M<5,< 3ZI6830 8/ 6% 6%%I6E ,6K6,589 N6,8/4 /NF?Lbn@@L
=7C D,22:+; &) )&+#%:'( #-#+3; 2:+/#( %&'('
)<3 5%,5;3%,3 /N ,/080 64505%& N4/H 8<3 600IH3; &3%34685/% H5O 5% 03,85/% _" N/4 E/6;0 /N ;5NN343%8
K4/N5E3" 50 038 /I8 5% )6DE3 GL
!:E*# I P T&-3 M,- %&'(' &) #-#+3; ',FF*;R =J=J
<'"; =#'>/() 5'9('"; ('11 ?$1.)2 ('"; <'"; ('11
`/43,608 ,/08 /N 0IKKE9 hC_LC_ hA_LA_ hA@LB_
)<303 N/43,608 ,/080 643 ,/HK643; M58< 8<3 @__Cd_A M</E306E3 3%34&9 ,/080 5% `5&I43 >L
@@ 2$'e @__A $+/e" #<6K834 F" KKLFT@B" FT@CL
!"
#!"
$!"
%!"
&!"
'!"
(!"
)!"
*!"
+!"
#!!"
!" #!" $!" %!" &!" '!" (!" )!" *!" +!" #!!"
! " # $ % & ' ) * + # $ , - # . #
!./$0-*%' ) *+ 1*./2
,-./ 1 2.3456/276/
89/:;
<=>?
=;@7
==>?
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 14/23
?B
903,+# G P 6&2F:+0'&- &) =JJASJB ."&*#':*# #-#+3; 2:+/#( %&'(' .0(" )&+#%:'( %&'('
)<3 N/43,608 ,/080 /N 3%34&9 0IKKE9 643 05&%5N5,6%8E9 &436834 8<6% @__Cd_A M</E306E3 0IKKE9 ,/080 038
/I8 5% 03,85/% @L?L $NN3,85S3E9" 8<3 H64P38 50 ,I443%8E9 ,E3645%& 68 6 K45,3 8<68 50 ,E/034 8/ 8<3 N/43,608@_@_ +</48 ]I% '64&5%6E #/08 -+]'#1 /N 3%34&9 0IKKE9 M58</I8 #7]+" /N 6KK4/O5H683E9 h@Gd'Y< N/4
8<3 3ZI5S6E3%8 &3%34685/% H5OL
)<3 5%NEI3%,3 /N 8<3 E/6; K4/N5E3 /% &3%34685/% ,/080 43H65%0 6KK643%8L
C7 >-#+3; 5#*01#+; 10: ("# (+:-'20''0&- :-5 50'(+0E,(0&- -#(.&+/'
)<3 5%,43H3%86E ,6K6,589 ,/080 6%; IK08436H 3%34&9 E/0030 600/,5683; M58< E/0030 5%,I443; M58<5%
;5NN343%8 E3S3E0 /N 8<3 %38M/4P 643 ;30,45D3; 5% 8<50 03,85/%L
C78 4-%+#2#-(:* -#(.&+/ %:F:%0(; %&'('
W38M/4P DI05%30030 643 <5&<E9 60038 5%83%05S3 6%; 8<3 600/,5683; 60038 43E683; ,/080 ,/%0858I83 8<3H6X/4589 /N 8<354 43S3%I3 43ZI543H3%8L (8 N/EE/M0 8<68 8<3 H65% ;3834H5%6%8 /N %38M/4P ,/08 50 8<3
K4/S505/% /N ,6K6,589 5% 8<3 %38M/4P" 43ZI545%& 580 6I&H3%8685/%L :/0030 5%,I443; 5% 8<3 %38M/4P 6;;
H64&5%6EE9 8/ 8<3 ,6K6,589 43ZI543; 8/ 0IKKE9 E/6; 6%; %33; 8/ D3 ,/083; /% 6% 3ZI5S6E3%8 D6050 8/
E/6; 43ZI543H3%80L
W38M/4P 600380 <6S3 S349 E/%& E5S30" &3%346EE9 5% 3O,300 /N F_ 93640" 6%; /N83%" E3%&8<9 ,/%084I,85/%
85H30L W38M/4P 6I&H3%8685/% 50 8<I0 3O843H3E9 mEIHK9^ 60 8<343 643 E64&3" <5&< ,/08 5%S308H3%80 68
5443&IE64 5%834S6E0L )<3 ,/085%& /N %38M/4P 034S5,30 I05%& 6 :]'# 6KK4/6,< 50 6KK4/K45683 8/ 8<50
058I685/%L 20038 ,/080 643 43,/S343; 8<4/I&< 8<3 438I4% /% 6%; 438I4% /N ,6K586E /S34 8<3 E5N3 /N 8<3
60038 6%; 8<3 ,/08 /N NI8I43 ;3S3E/KH3%8 /N %38M/4P 5%N46084I,8I43 ,6% D3 43NE3,83; D/8< 5% K45,30
N/4 8<3 I03 /N 8<3 %38M/4P 6%; 5% 8<3 S6EI5%& 8<3 ,/08 /N E/0030L
)<3 N5408 083K 5% 8<50 K4/,300 50 8/ 3S6EI683 8<3 :]'# /N 8<3 %38M/4PL )<3 W38 74303%8 k6EI3 -W7k1 /N
8<3 NI8I43 ,6K6,589 6I&H3%8685/% 5%S308H3%80 6%; 600/,5683; /K34685%& ,/08 643 0K436; /S34 8<3
600/,5683; 5%,43H3%8 5% 358<34 ;3H6%; /4 3%34&9L eS34 6 K345/; /N 03S346E 93640" N/4 $%34&92I0846E56
8<50 ,6E,IE685/% <60 430IE83; 5% 6% :]'# /N 6KK4/O5H683E9 C_n /N 8<3 6S346&3 %38M/4P 43S3%I3L (% 580
H/08 745,5%& 74/K/06E" $%34&92I0846E56 43S503; 580 6KK4/6,< 6%; 3085H683; H64&5%6E ,/080" D603; /%
Pk2" /N D38M33% G?n 6%; ?B@n N/4 8<3 H6X/4 8645NN ,E60030 @FL )<3 M35&<83; 6S346&3 /N 6EH/08 ?@_n
43K4303%80 6% 5%,43603 /% 364E534 93640" ,6I03; D9 <5&<34 E3S3E0 /N ,6K586E 0K3%;5%& 5% 8<3 @__AT?B
43&IE68/49 ,/%84/E K345/;L $ZI5S6E3%8 5%N/4H685/% M60 %/8 ;50,E/03; 5% #/I%849 $%34&9^0 @__AT?_
2%%I6E W38M/4P 745,5%& ]3K/48L
@F $%34&92I0846E56" W38M/4P 745,5%& 74/K/06E -]3S503;1" '69 @__A" )6DE3 G" KLBbL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 15/23
?G
2 ,/08 6EE/,685/% 6E5&%3; M58< 8<3 43ZI543H3%8 8/ 5%S308 5% 8<3 %38M/4P M5EE K4/S5;3 6% 6KK4/K45683
05&%6E /N 8<3 ,/08 /N K4/S5;5%& ,6K6,589 8/ H338 K36P K345/; ;3H6%;L )<3 6KK4/6,< ;30,45D3; 5% 8<50
K6K34 50 6 H/;5N5,685/% /N 6 ,/08 6EE/,685/% K4/,300 834H3; 8<3 '38</; /N (%834,3K80@B"@G
L
(% 8<50 5%N46084I,8I43 D603; ,/08 6EE/,685/%" 8<3 %38M/4P :]'# <60 D33% ,/%034S685S3E9 600IH3; 8/
43H65% 68 C_n /N 8<3 6S346&3 %38M/4P K45,3L )<50 ,/08 M60 6EE/,683; 8/ 8<3 IKK34 bGn /N 09083H
E/6;5%&" 05%,3 8<3 %38M/4P 50 &3%346EE9 6I&H3%83; 8/ K4/S5;3 ,6K6,589 N/4 E/6;0 6D/S3 8<50 E3S3EL )<3
:]'# ,/HK/%3%8 /N %38M/4P ,/08 50 8<343D9 6EE/,683; 8/ 8<3 K36P K345/; E/6;0L )<50 ,/%,3K8 50
5EEI084683; 5% `5&I43 bL
903,+# ? P Q#(.&+/ 2:+30-:* %&'( :**&%:(0&-
(% `5&I43 b" 8<3 6EE/,683; %38M/4P ,/08 H69 D3 033% 8/ 30,6E683 46K5;E9 8/ 580 K36P S6EI3" 60 E/6;0
3O,33; 8<3 bGn 8<430</E;L
)<50 %38M/4P ,/08 K4/N5E3 M60 6KKE53; 8/ ;5NN343%8 E/6;5%& K4/N5E30" 8/ 953E; 8<3 %38M/4P H64&5%6E ,/08
6EE/,685/% N6,8/40 0</M% 5% )6DE3 >L
!:E*# G P Q#(.&+/ 2:+30-:* %&'( :**&%:(0&- ):%(&+'
5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
bGn C_n ?F?n
)<3 %38M/4P H64&5%6E ,/08 6EE/,685/% N6,8/40 /N )6DE3 > M343 6KKE53; 8/ @__AT?_ 846%0H5005/% 6%;
;50845DI85/% K45,30" 8/ ;3834H5%3 8<3 ,/08 6KKE5,6DE3 8/ E/0030L
@B 24H0836;" # . 2EE/,685%& `5O3; #/080" $%34&9 (%834%685/%6E" a3,3HD34 ?A>AL
@G #/E3D/I4% . 6%; 2H/0 #" 745,5%& +5&%6E0 N/4 6 W38M/4P *I05%300" C8< (%0858I85/% /N $%&5%3345%& 6%;)3,<%/E/&9 ,/%N343%,3 /% 2;S6%,30 5% 7/M34 +9083H #/%84/E" eK34685/% 6%; '65%83%6%,3" ./%& o/%&"
W/S3HD34 @__AL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 16/23
?>
B#9*151#/), #1/>"*? ,".. ),,"9)/+"#
)<3 ,<648 68 45&<8 5% `5&I43 ? 5EEI0846830 S349 ;5NN343%8 K4/N5E30 600/,5683; M58< %/TE/6; -0<I%81 E/0030"
8<3 09083H E/6; 6%; E/6; -0345301 E/0030L :/00 N6,8/40 68 D/8< 846%0H5005/% 6%; ;50845DI85/% 643
%/4H6EE9 ;3834H5%3; N/4 8<3 09083H E/6; K4/N5E3L )<303 N6,8/40 %33; 8/ D3 6;XI083; 5% /4;34 8/
S6E5;E9 6KKE9 8/ E/6;0 M58< 6 ;5NN343%8 K4/N5E3L
)6DE3 b 0380 /I8 8<3 6;XI08H3%8 N6,8/40 6KKE53; 8/ E/00 N6,8/40 8/ 6,,/HH/;683 E/6;0 /N ;5NN343%8
K4/N5E3L
!:E*# ? P Q#(.&+/ *&'' :**&%:(0&- ):%(&+'
5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
>Fn ?__n ?GFn
C7= !+:-'20''0&- -#(.&+/ %&'('
)46%0H5005/% W38M/4P +34S5,3 74/S5;340 -)W+701 43,/S34 8<354 43S3%I3 S56 )46%0H5005/% l03 /N+9083H -)l/+1 ,<64&30 8/ aW+70L )<303 ,/080 6KK/485/%3; 8/ 8M/ W+Y ;50845DI8/40 643 0</M% 5%
)6DE3 C@>
L )<3 6EE/,683; 43S3%I3 N/4 8<3 ;50845DI8/40 M60 ,/%S3483; 5%8/ 6% 6S346&3 K45,3 I05%& 8<3
3%34&9 N/43,608 ,/%865%3; 5% 8<3 2$]^0 ;3834H5%685/%@b
L
!:E*# A P !+:-'20''0&- -#(.&+/ %&'('R VSK@"
:/1.#/*+.'# 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
'384/K/E586% h>L>_ hbL?_ h??L>_
]3&5/%6E h?@LF_ h?FL@_ h@?L>_
)<3 ,/08 6EE/,685/% N6,8/40 /N )6DE3 > M343 I03; 8/ N/4HIE683 )6DE3 CL
=*)#.5+..+"# #1! >"*? ,"..1.
)46%0H5005/% %38M/4P E/0030 643 6,,/HH/;683; 5% 8<3 H64P38 D9 H64&5%6E E/00 N6,8/40 I03; 8/ 6;XI08
8<3 K45,3 68 8<3 ]]W 8/ 8<3 K/5%8 /N ,/%%3,85/% 8/ 8<3 846%0H5005/% %38M/4PL )<3 H64&5%6E E/00
N6,8/40 ;5NN34 N/4 36,< 846%0H5005/% ,/%%3,85/% K/5%8L Y35&<83; 6S346&30 /N 8<3 846%0H5005/% E/00
N6,8/40 /N 8M/ W+Y ;50845DI8/40 -$%34&92I0846E56 6%; #/I%849 $%34&91 643 0</M% 5% )6DE3 AL
!:E*# B P !+:-'20''0&- -#(.&+/ *&''#'
:/1.#/*+.'# 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
'384/K/E586% _LCn ?LFn @L_n]3&5/%6E ?LBn @L@n FLFn
)<3 E/00 6EE/,685/% N6,8/40 /N )6DE3 b M343 I03; 8/ ;3834H5%3 8<3 K34,3%86&30 5% )6DE3 AL
@> 2$]" ̀ 5%6E ;3,505/% )46%0U45; 846%0H5005/% ;3834H5%685/% @__At?_ 8/ @_?Ft?B" @C 2K45E @__A" )6DE3 ALG"
KL?@@L
@b 2$]" ̀ 5%6E ;3,505/% W3M +/I8< Y6E30 ;50845DI85/% ;3834H5%685/% @__At?_ 8/ @_?Ft?B" @C 2K45E @__A" )6DE3
?>L@B" KLF@?" )6DE3 >LG" KLCb" )6DE3 >LF" KLCGL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 17/23
?b
C7C H0'(+0E,(0&- -#(.&+/ %&'('
)<3 89K5,6E 084I,8I43 /N 6 ;50845DI85/% %38M/4P 6%; 8<3 E3S3E0 /N 0IKKE9 643 0</M% 5% `5&I43 CL )<343
,6% D3 /S34E6K D38M33% 600380 /N >> Pk /4 <5&<34 S/E86&3" M<5,< 643 ;3N5%3; 5% 8<3 ]IE30 60
846%0H5005/% 5N 8<354 NI%,85/% 5%,EI;30 8<3 0IKK/48 /N 8<3 <5&<34 S/E86&3 846%0H5005/% %38M/4PL
903,+# A P D(+,%(,+# &) ("# 50'(+0E,(0&- -#(.&+/
#I08/H340 643 ,/%%3,83; 68 6EE E3S3E0 /N 8<3 %38M/4P" M58< E64&34 ,I08/H340 68 <5&<34 S/E86&3 E3S3E0
6%; 8<3 &4368 H6X/4589 /N 0H6EE ,I08/H340 43,35S5%& 0IKKE9 68 E/M S/E86&3L )<3 ,/080 600/,5683; M58<
8<3 ;50845DI85/% %38M/4P 643 6005&%3; 8/ ,/08 K//E0 N/4 8<3 ,E60030 /N 600380 5%S/ES3; 6%; 6EE/,683; 8/
;/M%08436H ,I08/H340" &3%346EE9 5% 6,,/4;6%,3 M58< 8<354 I85E50685/% /N 8<3 60038 ,/08 K//EL
)<3 &3%345, 084I,8I43 /N `5&I43 C ;/30 %/8 <5&<E5&<8 S349 05&%5N5,6%8 ;5NN343%,30 D38M33% 8<3
084I,8I43 /N ;50845DI85/% %38M/4P0 8<68 034S3 H384/K/E586% 6%; 43&5/%6E 64360=
• '384/K/E586% %38M/4P0 <6S3 HI,< &436834 E/6; ;3%058530" 0</4834 4/I83 E3%&8<0" 6 05&%5N5,6%8
K4/K/485/% /N E64&34 ,I08/H340 68 <5&<34 S/E86&3 E3S3E0 6%; /N83% 6 &436834 K4/K/485/% /N
I%;34&4/I%; ,/%084I,85/%V M<34360
• ]3&5/%6E %38M/4P0 643 ,<646,834503; D9 E/M E/6; ;3%058530" E/%& /S34<36; 4/I83 E3%&8<0 6%;
/I805;3 43&5/%6E ,3%8430" K43;/H5%6%8E9 <5&< S/E86&3 4385,IE685/%L
a50845DI85/% %38M/4P K45,5%& <60 D3,/H3 0IDX3,8 8/ 6 W685/%6E ,/HKE56%,3 43&5H3 I%;34 8<3 ]IE30"
43ZI545%& 8<3 ;50,E/0I43 /N 5%N/4H685/% ,/%,34%5%& H688340 0I,< 60 8<3 K45,5%& 6EE/,685/% K4/,300"
K45,3 E3S3E0 6%; ,<6%&30L )<3 W+Y K45,5%& K4/K/06E0 M343 8<3 N5408 8/ D3 0IDX3,83; 8/ 8<50 43&5H3" 5%
@__AL )<3 KIDE50<3; 5%N/4H685/% 5% 8<3 $%34&92I0846E56 6%; #/I%849 $%34&9 K45,5%& K4/K/06E0@C"@A M60 0IKKE3H3%83; M58< /8<34 KIDE50<3; 5%N/4H685/% 8/ ;345S3 8<3 ;50845DI85/% %38M/4P ,/080 68
;5NN343%8 E3S3E0 /N 8<3 %38M/4PF_"F?L
@C $%34&92I0846E56" W38M/4P 745,5%& 74/K/06E -]3S503;1" '69 @__A" )6DE3 ?@" KLGAL
@A #/I%849 $%34&9" 2%%I6E %38M/4P K45,30 43K/48 ? cIE9 @__A t F_ cI%3 @_?_" ̀ 5&I43 >" KL?_L
F_ 2$]" ̀ 5%6E ;3,505/% W3M +/I8< Y6E30 ;50845DI85/% ;3834H5%685/% @__At?_ 8/ @_?Ft?B" @C 2K45E @__A" )6DE3
>LG" KLCbL
F? $%34&92I0846E56" a50845DI85/% :/00 `6,8/4 #6E,IE685/% '38</;/E/&9 76K34" '64,< @__A" )6DE3 B" KL?@L
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 18/23
?C
)<3 600/,5683; ;50845DI85/% %38M/4P :]'# S6EI30 643 038 /I8 5% )6DE3 ?_ N/4 36,< E3S3E /N 8<3
%38M/4PL )<303 643 ,IHIE685S3 T 0IKKE9 8/ 6 E/M S/E86&3 E/6; M/IE; 5%,I4 36,< IK08436H ,/08
,/HK/%3%8L
!:E*# 8J P H0'(+0E,(0&- -#(.&+/ %&'('R VSK@"
:/1.#/*+.'# 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
8).#'='(/.",
+ID846%0H5005/% h?BLF_ h?GLF_ h@GL__
.5&< k/E86&3 h@LF_ h@LG_ hBL__
:/M k/E86&3 hF_L__ hF@L@_ hG@Lb_
)/86E hB>L>_ hG_L__ hC?LC_
B)7/',"(
+ID846%0H5005/% h>L__ h>LB_ h?_LG_
.5&< k/E86&3 hF@L>_ hFGL__ hGbL@_:/M k/E86&3 hFBLF_ hF>Lb_ h>_L?_
)/86E hb@LC_ hbCL?_ h?@CL__
)<3 ,/08 6EE/,685/% N6,8/40 /N )6DE3 > M343 6E0/ I03; 5% N/4HIE685%& )6DE3 ?_L
<7 H0'(+0E,(0&- -#(.&+/ *&''#'
a50845DI85/% E/0030 86P3 KE6,3 68 36,< /N 8<3 E3S3E0 /N 8<3 %38M/4P 5%;5,683; 5% `5&I43 CL )</03 E/0030
5%,EI;3 8<3 %/TE/6; 6%; E/6; E/0030 5% %38M/4P 3E3H3%80 6%; 6 0H6EE K4/K/485/% /N m%/%T83,<%5,6E
E/0030^ 8/ 6,,/I%8 N/4 H38345%& ;50,43K6%,530 6%; 8<3N8L
a50845DI85/% E/0030 643 6E0/ 0IDX3,8 8/ 6 43&IE68/49 43&5H3 5%S/ES5%& ;50,E/0I43 /N 8<3 K4/,30030
3HKE/93; 6%; 6KK4/S6E /N 8<3 430IE86%8 E/00 N6,8/40 I03; N/4 H64P38 0388E3H3%80L e%E9 /%3 /N 8<303
;50,E/0I43 ;/,IH3%80" $%34&92I0846E56^0F?" K4/S5;30 6 E/00 D6E6%,3 86DE3" M<5,< <60 D33% I03; 8/
;3S3E/K 8<3 mE36P9 K5K3^ ;56&46H 5% `5&I43 AL
903,+# B P H0'(+0E,(0&- *&''#' W*#:/; F0F#X 50:3+:2 )&+ 2#(+&F&*0(:- 50'(+0E,(&+
!" $%&'
(()*+
!" $%,,
-)./+
0" $%&'
1).+
0" $%,,
2)*+
34 $%&'
2/)(+
34 $%,,
2)2+
45&6,78,,8%6 $%,,
2).+
96:5;<
=>5?@&,:,
A5%7
BBC
2/2).+
D8,E58F>G%6 $%,,:, H)-+
%A ':$8I:5< 86E%
'8,E58F>G%6 6:EJ%5K96:5;< E%
D8,E58F>G%6
2//)/+
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 19/23
?A
(% `5&I43 A" 8<3 43E685S3 K4/K/485/%0 /N D/8< E/0030 6%; E/6; 0IKKE53; 68 ;5NN343%8 E3S3E0 /N 8<3
%38M/4P ,6% D3 033%L 2 05H5E64 ;56&46H N/4 6 43&5/%6E ;50845DI8/4 H69 D3 3OK3,83; 8/ 43S36E <5&<34
/S346EE E/0030 68 846%0H5005/%" 0ID846%0H5005/% 6%; <5&< S/E86&3 ;50845DI85/% E3S3E0 -8/86EE5%& ?_n /4
H/431L (% 6;;585/%" 8<3 E/M34 3%34&9 ;3%0589 %/4H6EE9 5HKE530 6 0H6EE34 K4/K/485/% /N 3%34&9
,/%0IH3; 68 <5&<34 S/E86&3 E3S3E0" D9 E64&34 ,I08/H340L
)<3 6KK4/S3; @__AT?_ ;50845DI85/% E/00 N6,8/40 I03; 5% H64P38 0388E3H3%80 D9 W$''#eF@ M343 I03;
8/ ,/%084I,8 8<3 86DE3 /N E/00 N6,8/40 5% )6DE3 ?? N/4 $%34&92I0846E56 6%; #/I%849 $%34&9L
)<3 K34,3%86&30 6KKE9 60 6 S/EIH3 6;XI08H3%8 8/ 8<3 ZI6%858530 0388E3; 68 8<3 H64P38 ]]WL
!:E*# 88 P H0'(+0E,(0&- *&''#'
:/1.#/*+.'# 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
8).#'='(/.",
+ID846%0H5005/% ?L?n ?Lbn @LGn
.5&< k/E86&3 _LAn ?LGn @LFn
:/M k/E86&3 @LFn FLGn GLBn
)/86E >Lbn
B)7/',"(
+ID846%0H5005/% ?LCn @LCn BLFn
.5&< k/E86&3 _Lbn ?L?n ?L>n
:/M k/E86&3 BL_n >LBn ALCn
)/86E ?_L@Gn
)<3 E/00 6EE/,685/% N6,8/40 /N )6DE3 b M343 I03; 8/ ;3834H5%3 8<3 K34,3%86&30 5% )6DE3 ??L
F@ 2$'e" a50845DI85/% :/00 `6,8/40 N/4 8<3 @__Ad?_ `5%6%,56E q364 T k3405/% W/= B" 3NN3,85S3 2I&I08 @__A"
)6DE3 #G" KL?B" )6DE3 #>" KL?GL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 20/23
@_
I7 6&'( &) *&''#' .0("0- -#(.&+/'
)<3 3E3H3%80 ;30,45D3; 5% 03,85/%0 @ 6%; F <6S3 D33% ,/HD5%3; 8/ 953E; 8<3 :]'# /N 0IKKE95%& E/6;0
/N ;5NN343%8 K4/N5E3 68 ;5NN343%8 E3S3E0 M58<5% 8<3 %38M/4PL )<3 /I8,/H3 50 0</M% 5% )6DE3 ?@L
!:E*# 8= P 6&'( &) *&''#' .0("0- -#(.&+/'
:/1.#/*+.'# 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
'64P38 K45,3 hFCLA_ hB@LC_ hBbLF_
-),)#"./', <B8& hC_LC_ hA_LA_ hA@LB_
8).#'='(/.", <B8&
)46%0H5005/% ,/%%3,85/% K/5%8 hCCL?_ hAAL?_ h?_>L__
+ID846%0H5005/% h?_FL__ h??>L__ h?FFL__
.5&< k/E86&3 h?_bL__ h?@_L__ h?FCL__
:/M k/E86&3 h?FAL__ h?GGL__ h?A>L__
B)7/',"( <B8&
)46%0H5005/% ,/%%3,85/% K/5%8 hABLB_ h?_>L__ h??bL__
+ID846%0H5005/% h?_@L__ h??GL__ h?F?L__
.5&< k/E86&3 h?FGL__ h?G?L__ h?A_L__
:/M k/E86&3 h?b@L__ h?AFL__ h@GAL__
)<3 ,/08 /N E/0030 ,/HK/%3%80 68 ;5NN343%8 E3S3E0 5% 8<3 %38M/4P 643 6E0/ 5EEI084683; 5% `5&I43 ?_L
903,+# 8J P 6&'( &) *&''#' .0("0- -#(.&+/'
!" !#" !$"" !$#" !%"" !%#" !&""
'() +(,-./0
12/3 +(,-./0
456-7.89:2992(8
;7.89:2992(8
<807/=
!" !#" !$"" !$#" !%"" !%#" !&""
'>?@ 0807/=
;A(4
;7.89:2992(8 ,(9909
BA(4 -( 4;
'(9909 -( 4;
BA(4 -( 1+
'(9909 -( 1+
BA(4 -( '+
'(9909 -( '+
'() +(,-./0
12/3 +(,-./0
456-7.89:2992(8
;7.89:2992(8
<807/=
'() +(,-./0
12/3 +(,-./0
456-7.89:2992(8
;7.89:2992(8
<807/=
! " # $ " % ' ( % %
! ) % * " + ' (
, -
."*#(/('$*,0 -$%*#$12*(#
3"4$(0,' -$%*#$12*(#
! 5 2 0 * ' ( % %
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 21/23
@?
G7 6&-%*,50-3 +#2:+/'
)<3 N/43&/5%& 6%6E9050 /N 8<3 ,/08 /N E/0030 N/EE/M0 S349 05&%5N5,6%8 43,3%8 5%,436030 5% 8<3 ,/08 /N 8M/
/N 8<354 H6X/4 ,/HK/%3%80L )<3 ,/08 3085H6830 5%,EI;3 8<3 %3,300649 ;5085%,85/% D38M33% %/TE/6;
6%; E/6; E/0030L
G78
K&1#2#-( 0- ("# %&'( &) *&''#'
2 05H5E64E9 084I,8I43; 3085H683 /N 8<3 E/%& 4I% ,/08 /N E/0030 5% @__G 953E;3; 8<3 ,/080 038 /I8 5% )6DE3
?F" N/4 8<3 E/M S/E86&3 E3S3E /N $%34&92I0846E56^0 %38M/4PLFF
!:E*# 8C P K&1#2#-( 0- ("# %&'( &) *&''#'
B)J/)3 :".) 5'9('"; ('11 ?$1.)2 ('"; <'"; <'11
@__G 6%6E9050 cIE9 @__G hC@ hA_ h?@b
\ #7( 6;XI08H3%8 a3,3HD34 @__A hAB h?_F h?BG
@_?_ 6%6E9050 a3,3HD34 @__A h?FA h?GG h?A>
(%,43603 BCn G?n FGn
)<3 6%6E9050 ;30,45D3; 5% 8<50 43K/48 ,/%N54H0 8<68 8<343 <60 D33% 6 S349 05&%5N5,6%8 5%,43603 5% 8<3
S6EI3 8<68 0</IE; D3 68845DI83; 8/ E/0030 5% %38M/4P 5%S308H3%8 6%6E9050L )<50 ;5NN343%,3 ,6% D3
68845DI83; 8/ 8M/ 5%NEI3%,30=
• 2% 5%,43603 5% 8<3 ,/08 /N 3%34&9 &3%34683; D9 %3M 83,<%/E/&530" 5% M<5,< K43S5/I0E9
I%3,/%/H5, N/4H0 /N &3%34685/% <6S3 D3,/H3 ,/HK38585S3 ;I3 8/ 8<3 K4303%,3 /N 8<3 #7]+
6%; ]$)V 6%;
• +5&%5N5,6%8 5%,436030 5% %38M/4P ,/080" 64505%& K45%,5K6EE9 N4/H 5%,43603; E3S3E0 /N ,6K586E
3OK3%;58I43 8/ 6I&H3%8 %38M/4P ,6K6,589 E3S3E0 8/ H68,< 5%,43603; ;3H6%; &4/M8<L
G7= H0'(+0E,(0&- (+:-')&+2#+ K>LD
)<3 ,/08 /N E/0030 50 8<3 ;3834H5%5%& N6,8/4 5% 3086DE50<5%& 8<3 '$7+ N/4 ;50845DI85/% 846%0N/4H340L
)<3 0K3,5N5,685/% /N ;50845DI85/% 846%0N/4H34 3%34&9 K34N/4H6%,3 43ZI543H3%80 50 ,I443%8E9
I%;34M69 60 K648 /N 8<3 2I0846E56% U/S34%H3%80^ $ZI5KH3%8 $%34&9 $NN5,53%,9 74/&46H -$F1L )<3
,/%0IE8685/% ](+ 50 ,I443%8E9 6M6583;L
(8 50 43,/HH3%;3; 8<68 5% 3086DE50<5%& 8<3 +86&3 @ '$7+ N/4 ;50845DI85/% 846%0N/4H340" ,/%05;34685/%
%33;0 8/ D3 &5S3% 8/=
• )<3 05&%5N5,6%8 5%,43603 5% 8<3 ,/08 /N E/0030 5% 3086DE50<5%& 8<3 3NN5,53%,9 E3S3E0V 6%;
•
2 43S503; 83085%& 6KK4/6,<" M<5,< KE6,30 &436834 M35&<85%& /% 8<3 <5&<34 ,/08 /N E/6; E/0030"
5% 43,/&%585/% /N 8<3 &436834 ,/08 /N 8<354 K4/S505/%L
G7C M#3,*:(&+; :++:-3#2#-(' )&+ -#(.&+/ E,'0-#''#'
W38M/4P DI05%30030 ;/ %/8 KI4,<603 3%34&9 8/ H6P3 IK E/0030 N4/H 8<3 H64P38 6%; 8<343 50
,I443%8E9 %/ ;543,8 43&IE68/49 5%,3%85S3 0,<3H3 N/4 ;50845DI85/% DI05%30030 8/ H5%5H503 8<354 09083H
E/0030L
(8 50 6KK643%8 N4/H 8<3 S645/I0 3O6HKE30 6KK3%;3; 8/ 8<50 43K/48 8<68 8<343 50 6 %33; N/4 ;50845DI85/%
DI05%30030 5% K6485,IE64 8/ N6,8/4 8<3 ,/08 /N E/0030 5%8/ 8<354 5%S308H3%8 ;3,505/%TH6P5%& 5% 6 %IHD34
FF #/E3D/I4% ." #/08 /N E/0030 N/4 %38M/4P 5%S308H3%8 6KK46506E" $E3,845, $%34&9 +/,5389 /N 2I0846E56
#/%N343%,3" ?C W/S3HD34 @__GL
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 22/23
@@
/N ;5NN343%8 M690L Y<5E08 %/ 0IDT/K85H6E 5%S308H3%8 ;3,505/%0 M343 5;3%85N53;" 8<3 ,/08 /N E/0030 M60
H683456E 5% 43E685/% 8/ 6 %IHD34 /N 8</03 ;3,505/%0 6%; 5N 5&%/43; ,/IE; K/83%856EE9 E36; 8/
I%3,/%/H5, ;3S3E/KH3%8L
e%3 0/EI85/% 8<68 <60 D33% K4/K/03; 8/ K4/S5;3 %38M/4P DI05%30030 M58< 6% 5%,3%85S3 8/ H5%5H503
%38M/4P E/0030 50 8/ H6P3 8<3H 430K/%05DE3 N/4 KI4,<605%& 8<3 3%34&9 E/0030 5% 8<354 %38M/4P0 N4/H
8<3 H64P38L )<50" </M3S34" <60 6 %IHD34 /N 05&%5N5,6%8 ;46MD6,P0=
• 20 8<3 6%6E9050 5% 8<50 43K/48 <60 ;3H/%084683;" 8<3 ,/08 /N E/0030 KI4,<603; N4/H 8<3 H64P38
50 0ID086%856EE9 E300 8<6% 8<3 E/%& 4I% ,/08 8<68 %33;0 8/ D3 N6,8/43; 5%8/ 8<3 3,/%/H5,
6%6E9050 /N 5%S308H3%8 5% 600380 M58< 6 034S5,3 E5N3 /N F_ 93640 /4 H/43V
• `/4 ;50845DI85/% DI05%30030" 8<3 H6&%58I;3 /N 09083H E/0030 50 05&%5N5,6%8" ZI583 /N83% E64&34
8<6% 8<3 3%34&9 ,/%0IHK85/% /N 8<354 E64&308 ,I08/H34V 6%;
• )<3 KI4,<603 /N E/08 3%34&9 M/IE; 5%S/ES3 %38M/4P DI05%30030 5% H64P38 846;5%&
6446%&3H3%80" M<5,< 50 68 /;;0 M58< 8<3 ,I443%8 5%83%85/%6E 03K64685/% /N 8<354 6,85S58530
N4/H 846;5%&V 6%;
• )<68 5%S/ES3H3%8 5% 3%34&9 846;5%& M/IE; 5%84/;I,3 6 05&%5N5,6%8 E3S3E /N 450P 3OK/0I43 N/4
M<5,< %38M/4P DI05%30030 <6S3 %/8 D33% 084I,8I43; /4 643 ,I443%8E9 N5%6%,3;L
)<3 3O5085%& H64P38 6446%&3H3%80 N/4 D/8< 846%0H5005/% 6%; ;50845DI85/% DI05%30030 ;/ %/8 K4/S5;3
8<3H M58< 6 N5%6%,56E 5%,3%85S3 8/ /K85H503 8<3 ,/08 /N E/08 3%34&9L ]68<34" 8<3 H64P38 /DX3,85S3 50
K4/HIE&683; 8<4/I&< 8<3 ]3&IE68/49 (%S308H3%8 )308L
)<3 ]3&IE68/49 (%S308H3%8 )308 N/4 )46%0H5005/% -]()T)1 43ZI5430 846%0H5005/% DI05%30030 8/ 6%6E903
8<3 H64P38 D3%3N580 600/,5683; M58< 5%S308H3%80L )/ 8<3 3O83%8 8<68 8<3 H64P38 05HIE685/% I03; D9
)W+70 N6,8/40 5% 8<3 NI8I43 ,/08 /N &3%34685/%" 60 2$'e^0 ;/30" 6% 6KK4/K45683 S6EI3 M/IE; D3
KE6,3; /% 8<3 ,/08 /N E/0030L
)<3 ]IE30 ,/%,34%5%& ;50845DI85/% %38M/4P KE6%%5%& 6%; 3OK6%05/% 643 8<3 0IDX3,8 /N ,I443%8 43S53M
D9 8<3 2$'#" 68 8<3 ;543,85/% /N 8<3 '#$L 2 05&%5N5,6%8 60K3,8 /N 8<3 %3M 6446%&3H3%80 M5EE D3 8<3
43S53M /N 8<3 3ZI5S6E3%8 ]3&IE68/49 (%S308H3%8 )308 N/4 a50845DI85/% -]()Ta1L )<3 K/E5,9 5%83%8 <60
D33% 3086DE50<3; 8<3 2$'# 6%; 8<3 600/,5683; ]()Ta 6%; 2KKE5,685/% UI5;3E5%30 M5EE D3 N5%6E503; D9
H5; @_?_L
*3,6I03 /N 8<3 43E685S3 05&%5N5,6%,3 /N ;50845DI85/% E/0030 6%; 8<3 6883%;6%8 ,/080" 58 50 6KK643%8 8<68
8<3 N/EE/M5%& 3E3H3%80 %33; 8/ D3 N6,8/43; 5%8/ 8<3 43&IE68/49 6446%&3H3%80 N/4 ;50845DI8/40" 8/
6S/5; 6 ,/%85%I685/% /N 0IDT/K85H6E 5%S308H3%8 5%,3%85S30=
• )<3 E/%& 4I% ,/08 /N E/0030 5% ;50845DI85/% %38M/4P0 %33;0 8/ D3 3086DE50<3; /% 6 I%5N/4H
D6050 6,4/00 8<3 W$'" 6EE/M5%& N/4 43&5/%6E S645685/%V
• 2$'e 50 ,E364E9 8<3 /4&6%50685/% D308 3ZI5KK3; 8/ ;3834H5%3 8<3 ,/08 /N E/0030 68 8<3
846%0H5005/% ,/%%3,85/% E3S3E" I05%& 8<3 06H3 NI8I43 &3%34685/% ,/080 60 8<50 43K/48V
• $6,< ;50845DI8/4 0</IE; D3 43ZI543; 8/ 3085H683 8<3 6S346&3 ,/08 /N E/0030 68 6KKE5,6DE3 E3S3E0
M58<5% 580 %38M/4P" N/4 I03 5% 5%S308H3%8 6%6E9050V
• $6,< ;50845DI8/4 0</IE; D3 43ZI543; 8/ ;3H/%084683 8<68 6% 6KK4/K45683 S6EI3 <60 D33%
60,45D3; 8/ 8<3 ,/08 /N E/0030 5% 580 3ZI5KH3%8 0K3,5N5,685/% 6%; KI4,<605%& ;3,505/%0V
• )<3 ]()Ta 0</IE; 43ZI543 aW+70 8/ ,6449 /I8 6 05HKE5N53; 0,433%5%& 8308 N/4 36,< %38M/4P
5%S308H3%8" 8/ ;3834H5%3 M<38<34 8<3 ,/08 /N E/0030 M/IE; <6S3 6 H683456E 5HK6,8 /% 8<3
/I8,/H3V
• )<3 5%S308H3%8 6KK46506E N/4 E64&3 6I&H3%8685/%0 0</IE; I03 5%;5S5;I6EE9 ,6E,IE683;" 468<34
8<6% 6S346&3; E/00 ,/080V
7/25/2019 Cost of Losses
http://slidepdf.com/reader/full/cost-of-losses 23/23
• )<343 50 6 %33; N/4 6 &3%346E 43&IE68/49 5%,3%85S3 -3ZI5S6E3%8 8/ 8<3 +)7(+1 8/ K4/S5;3
6KK4/K45683 NI%;5%& E3S3E0 N/4 43E685S3E9 0H6EE 5%S308H3%80 0I,< 60 K/M34 N6,8/4 ,/443,85/%
6%; E/00 43;I,85/% 5% 4I46E 64360L
?7 N%/-&.*#53#2#-(
)<3 6I8</4 &4683NIEE9 6,P%/ME3;&30 8<3 N5%6%,56E 0IKK/48 /N 8<3 #/KK34 a3S3E/KH3%8 200/,5685/% 5%,64495%& /I8 8<3 6%6E9050 ;30,45D3; 5% 8<50 ;/,IH3%8L