Ultimate Net Loss (UNL)

The loss amount, including covered loss adjustment expenses (LAE), against which the retention and the reinsurance limits apply.

This term usually means the total sum which the assured, or any company as his insurer, or both, become obligated to pay either through adjudication or compromise, and usually includes hospital, medical and funeral charges and all sums paid as salaries, wages, compensation, fees, charges and law costs, premiums on attachment or appeal bonds, interest, expenses for doctors, lawyers, nurses, and investigators and other persons, and for litigation, settlement, adjustment and investigation of claims and suits which are paid as a consequence of the insured loss, excluding only the salaries of the assured’s or of any underlying insurer’s permanent employees.

The term applied to the reinsurer’s loss under a reinsurance contract, generally the gross loss less any recoveries from other insurance which inure to the benefit of the contract in question.