The portion of premiums transferred to reinsurers in return for their participation in losses.
Ceded premiums represent the direct cost of the reinsurance program. For a quota-share treaty they represent the cession percentage applied to GWP. For XL they are expressed as a rate on subject premium or fixed amount. They reduce net premiums available to cover net losses and expenses. Net premiums = GWP − ceded premiums. The effective net reinsurance cost accounts for ceding commissions received (ceded − commissions = net cost).
GWP 10 M EUR, 30% QS → ceded premiums 3 M EUR. Commission received 750K EUR → net reinsurance cost = 3 M − 0.75 M = 2.25 M EUR.
ceded premiums, primes de réassurance, reinsurance premium paid