I am confused, please help. Should I subtract RE premium or not? and what's the threshold in S15 #25a?

In 25a, why is there only a 5% of reinsurer incurring a loss? If the reinsurer is paying "all ceded losses in entirety", wouldn't a 5M claim be >10% U/W loss too? Thanks!

The infinite problem generator in BQ2 does not subtract reinsurer premiums when computing the U/W loss, but #25a in BQ3 DOES net out the premiums when computing the loss. Which is the correct approach