I think he knows to. He is just waiting for the moment to let him know in some way. Not sure if he will kill him, as Floki is a big part of the cast. They didn't show much of anything in the preview for the season finally. Looks like the storm the castle again. In the legend, Ragnar ends up becoming a prisoner of Paris and dies in jail or is executed. I hope they don't follow that legend as I want this show to go on for alot longer then one more season and it need to have Ragnar in it.
There are two legends about Ragnar's death I have read:
1) Like the one you mention, he dies of disease. He brings home a giant load of riches from Paris. But, he dies of dysentery. Apparently, "Lothbrok" means "leather-legged" which is what victims looked like due to the diarrhea.
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2), He is captured by King Aielle and thrown into a pit of snakes. After a shipwreck, Aielle captures him. BTW, the Aiell's snake pit was shown in Season 1.
So, I've always thought Ragnar will go by #2. It's dramatic TV for sure.