What Does Rate on Line Mean?

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What does Rate on Line mean? Read on to discover the definition & meaning of the term Rate on Line - to help you better understand the language used in insurance policies.

Rate on Line

Rate on Line

A percentage derived by dividing reinsurance premium by reinsurance limit; the inverse is known as the payback or amortization period. For example, a $10 million catastrophe cover with a premium of $2 million would have an ROL of 20 percent and a payback period of 5 years.

We hope the you have a better understanding of the meaning of Rate on Line.

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