Probable maximum loss

Probable maximum loss ( engl. probable maximum loss, PML) is a term from the insurance industry.

In reinsurance, the (insurance ) property lines of the probable maximum loss measures the deductible and the reinsurance business ceded ( the level of involvement of the reinsurer to the risk of damage by proportional [ pro rata ] or non-proportional reinsurance). For example, tried in the fire insurance industry to identify with findings on previously incurred losses, design, fire hazard and location of buildings, what damage can be expected at most.

• Re-insurance