The body of cedant premium on which a non-proportional treaty's rate is calculated.
The subject premium base is the volume of cedant premium to which the contractual rate applies in order to determine the reinsurance premium. Its definition is among the most technical and most disputed points of a treaty, because it decides what counts: gross or net of producer commission, net or not of cessions to other treaties, including or excluding taxes, management fees, ancillary lines and inward business accepted from other insurers. The most widespread formulation, gross net premium income, takes gross premium less only cessions to inuring reinsurance. The problem it solves is commensurability: a rate means nothing unless referred to a quantity both parties define identically and that stays stable year to year. A base whose perimeter shifts with the cedant's internal reorganizations makes any rate comparison illusory, which is why well drafted treaties define the base by reference to named accounting lines rather than by a general formula.
A cedant presents a 2026 base of 240 million euros at a rate of 2.8 percent. The reinsurer notes that the definition now excludes a subsidiary carrying 31 million of premium that sat inside the perimeter the year before. On a restated base of 271 million the equivalent rate would be 2.48 percent, and the 4 percent price reduction shown at renewal is in truth a 15 percent reduction.
Subject premium base, Assiette de calcul, Base de prime, Gross net premium income, GNPI