Gross losses less reinsurance recoveries, representing the actual loss burden borne by the cedant.
Net losses are obtained by deducting reinsurance recoveries from gross losses. They represent the actual charge borne by the cedant and form the numerator of the net loss ratio. The gross/net difference can be very significant in catastrophe years, justifying reinsurance program investment. In reserving, net reserves are gross reserves less the reinsurers' share of reserves.
Hailstorm: gross losses 12 M EUR, cat XL recoveries 7 M EUR → net losses 5 M EUR = retention level.
net losses, sinistres nets de réassurance, net incurred losses