All underwriting profit generated by the protected cell is for the benefit of the cell owners and associated policyholders. The Protected Cell Agreement sets out how this will be calculated and, in summary, is as follows for each insurance programme:

The following will be credited to the experience account:
All premiums received by Euroguard;
All over-riders, commissions and fees earned;
All investment income earned;

The following will be debited to the experience account:

• Reinsurance premiums paid or due;
• Claims paid;
• Claims admitted but not yet paid;
• Claims incurred but not yet reported;
• Expenses incurred in connection with the underwriting and investments relating to the preference shareholder;
• Underwriting fee and management fee.

Any such underwriting profit, as calculated above, will be available for distribution as a dividend to the preference shareholder or could be retained within the protected cell to build insurance reserves to underwrite future years’ risks