https://www.insurerbrain.com/w/index.php?action=history&feed=atom&title=Definition%3ANet_written_premium 2026-06-13T10:28:37Z Revision history for this page on the wiki MediaWiki 1.43.8 https://www.insurerbrain.com/w/index.php?title=Definition:Net_written_premium&diff=6985&oldid=prev 2026-03-10T05:02:38Z

<p>Bot: Creating new article from JSON</p> <p><b>New page</b></p><div>💰 &#039;&#039;&#039;Net written premium&#039;&#039;&#039; represents the total [[Definition:Premium | premium]] an [[Definition:Insurance carrier | insurance carrier]] records for [[Definition:Policy | policies]] written during a specific period, minus the premium ceded to [[Definition:Reinsurer | reinsurers]] under all applicable [[Definition:Reinsurance | reinsurance]] agreements. It sits between [[Definition:Gross written premium (GWP) | gross written premium]] — the full amount before any cessions — and [[Definition:Net earned premium | net earned premium]], which further adjusts for the timing of coverage delivery. Net written premium captures what the insurer has committed to retain on a written basis, making it a key indicator of the company&#039;s appetite for risk and its reliance on reinsurance.<br /> <br /> 📐 To arrive at the figure, an insurer starts with gross written premium and subtracts all outward cessions: [[Definition:Treaty reinsurance | treaty]] and [[Definition:Facultative reinsurance | facultative]] placements, [[Definition:Quota share reinsurance | quota share]] percentages, and any premiums paid for [[Definition:Excess of loss reinsurance | excess-of-loss]] protection. If the company also assumes premium inward from other carriers through [[Definition:Assumed reinsurance | assumed reinsurance]], that amount is added back in. The resulting net written premium reflects the insurer&#039;s retained book of business on a written-date basis, regardless of how much of that premium has been earned through the passage of time. Because the calculation hinges on reinsurance structure, a single change in treaty terms at renewal can shift net written premium significantly from one period to the next.<br /> <br /> 📉 Tracking net written premium over time reveals important trends about an insurer&#039;s growth strategy and risk posture. A rising gross-to-net ratio — meaning a larger share of premium is being retained — may signal confidence in [[Definition:Underwriting | underwriting]] profitability or reflect tighter reinsurance markets that make ceding more costly. Conversely, a shrinking net written premium relative to gross can indicate a deliberate strategy to reduce [[Definition:Net retention | net retention]] amid [[Definition:Catastrophe risk | catastrophe risk]] concerns. [[Definition:Rating agency | Rating agencies]] and financial analysts compare net written premium to [[Definition:Surplus | policyholder surplus]] through the [[Definition:Net premium-to-surplus ratio | net premium-to-surplus ratio]], a leverage metric that gauges whether the carrier has adequate capital backing its retained obligations.<br /> <br /> &#039;&#039;&#039;Related concepts&#039;&#039;&#039;<br /> {{Div col|colwidth=20em}}<br /> * [[Definition:Gross written premium (GWP)]]<br /> * [[Definition:Net earned premium]]<br /> * [[Definition:Reinsurance cession]]<br /> * [[Definition:Net premium-to-surplus ratio]]<br /> * [[Definition:Assumed reinsurance]]<br /> * [[Definition:Surplus]]<br /> {{Div col end}}</div>

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