Net Leverage

The sum of a company's net premium written to policyholder surplus and net liabilities to policyholder surplus. This ratio measures the combination of a company's net exposure to pricing errors in its current book of business and errors of estimation in its net liabilities after reinsurance, in relation to policyholder surplus.

See Also: Net Investment Income; Net Income; National Association of Insurance Commissioners (NAIC); Named Perils; Net paid losses during the current year plus the change in loss reserves since the prior year end.;

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