Reinsurance
Definition of "Reinsurance"
Form of insurance that insurance companies buy for their own protection, "a sharing of insurance." An insurer (the reinsured) reduces its possible maximum loss on either an individual risk (facultative reinsurance) or a large number of risks (automatic REINSURANCE) by giving (ceding) a portion of its liability to another insurance company (the reinsurer).
Reinsurance enables an insurance company to expand its capacity; stabilize its underwriting results; finance its expanding volume; secure catastrophe protection against shock losses; withdraw from a class or line of business, or a geographical area, within a relatively short time period; and share large risks with other companies.
Popular Insurance Terms
Requirement that the combination of medicare and the employer's plan can not be greater than the amount the employer's plan would pay without Medicare. ...
Covers losses resulting from the malfunction of boilers and machinery. Most property insurance policies exclude these losses, which is why a separate boiler and machinery policy or a ...
Classification of occupations according to the degree of risk inherent in that occupation. ...
Arrangement that provides for the reduction of estate taxes and the payment of tax-deductible life insurance premiums. The procedure is for a donor to present a charity with a gift of a sum ...
Optional provision in a disability income policy that allows the policyowner to increase the monthly income sum at an approximate rate of 6%. ...
Coverage on an all risks basis for physical damage loss. Coverage applies to property damage to the insured boat or damage caused by the insured boat to a third party boat. Excluded perils ...
Circumstance that produces the loss. ...
Retirement vehicle permitted under section 403 (b) plan of the U.S. Internal Revenue Code for employees of a public school system or a qualified charitable organization. Under such an ...
Statutory law that lowers the defendant's liability by restricting the monetary recovery of the plaintiff incurring a specified injury, such as pain and suffering, or by restricting the ...
Have a question or comment?
We're here to help.