General accounting A property-casualty insurer brings in $6.15 Million inpremiums onto its homeowners MP line of insurance.The line's losses amount at $4,212,750, expenses are$1,506,750, and dividends are $92,250. The insurerearns $153,750 in the investment of its premiums.Calculate the line's operating ratio.

Explanation: The formula to calculate operating ratio is as follows:Operating ratio = [(Losses +…

Answered: A property-casualty insurer brings in…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 12P

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A property-casualty insurer brings in $6.15 Million in premiums onto its homeowners MP line of insurance. The line's losses amount at $4,212,750, expenses are $1,506,750, and dividends are $92,250. The insurer earns $153,750 in the investment of its premiums. Calculate the line's operating ratio.