@ xxxxx and mwekez@ji
. Underwriting profit is And I quote investopedia "Definition of 'Adjusted Underwriting Profit'
The profit that an insurance company generates after paying out claims and expenses. Insurance companies earn revenue by underwriting new business (selling new insurance policies) and earning income on their financial investments. Subtracted from this revenue are expenses associated with running the business and any claims that are made by insurance policy holders. The remainder is the adjusted underwriting profit. This is a term specific to the insurance industry.
Also called Underwriting Gain.
http://www.investopedia....rofit.asp#axzz20IsARdSk
Where is your inclusion of ADMINISTRATIVE EXPENSES in your calculations?????
So by the above, but this is not how to work out UNDERWRITING PROFIT/LOSS I beg to modify your thesis as follows:
Net premiums : 7,341,996,000. I agree
add commissions earned + 863,644,000. Agreed
Less net Ben n claims. -6,114,019,000. Agreed
Less comms paid. -1,580,420,000. Agreed although u added 10,000 :)
less Ops expenses. -1,804,331,000. How did you conveniently forget this integral part of the formula?
.
Leaves a net underwriting
loss of -1,293,313,000
I hope someone proves me wrong on this, with CREDIBLE arguments
If you want to work out UNDERWRITING PROFIT, expenses must be deducted.
http://en.wikipedia.org/wiki/Underwriting_profit
Please read investopedia or any other web based info on this.
I don't understand why you want to subtract operating expenses AFTER how does that work? I didn't make up the rules brother(sister)!! It's just what they are. You can refer to the various links which also say to work out COMBINED RATIO or UNDERWRITING PROFIT, EXPENSES MUST BE SUBTRACTED. But if you don't feel like subtracting the expenses and you want to modify the worldwide formula for whatever reason, please do ...or don't, entirely upto you.
Disclaimer:
I obviously, could be wrong, but opinions expressed on my posts are just my opinions.