Net claims paid is obtained by totaling (adding or subtracting as indicated) items ① to ④ listed to the right, and plainly shows the amount of insurance claims paid. The payment of insurance claims is the main expenditure involved in the non-life insurance business.

      ①Direct claims paid
−) ②Reinsurance claims ceded
+)  ③Reinsurance claims paid
−) ④Retrocession claims ceded
   ⑤Net claims paid
  (Income statement item)