A Clause in a reinsurance agreement, which provides for estimation, payment and complete discharge of all future obligations for reinsurance losses incurred regardless of the continuing nature of certain losses such as unlimited medical and lifetime benefits for Workers’ Compensation.
An agreement between the ceding insurer and the reinsurer that provides for the valuation, payment and complete discharge of all obligations between the parties under particular reinsurance contract(s). Although more common where the ceding insurer or reinsurer has concerns about the other party’s financial condition, commutation agreements can be used whenever the parties wish to … Read more
The termination of all obligations between the parties to a reinsurance agreement, accompanied by a final cash settlement. Commutation may be required by the reinsurance agreement or may be effected by mutual agreement .
Enacted in several states on health insurance policies. Insurers are required to accept all applicants for coverage and charge all applicants the same premium for the same coverage regardless of age or health. Premiums are based on the rate determined by the geographic region’s health and demographic profile.
In reinsurance, the primary insurance company usually pays the reinsurer its proportion of the gross premium it receives on a risk. The reinsurer then allows the company a ceding or direct commission allowance on such gross premium received, large enough to reimburse the company for the commission paid to its agents, plus taxes and its … Read more
Short-term, unsecured, and usually discounted promissory note issued by commercial firms and financial companies often to finance current business. Commercial paper, which is rated by debt rating agencies, is sold through dealers or directly placed with an investor.
Package policy that includes property, boiler and machinery, crime, and general liability coverages.
Products designed for and bought by businesses. Among the major coverages are boiler and machinery, business interruption, commercial auto, comprehensive general liability, directors and officers liability, fire and allied lines, inland marine, medical malpractice liability, product liability, Professional Liability, surety and fidelity, and Workers Compensation. Most of these commercial coverages can be purchased separately except business interruption which … Read more
A reinsurance agreement which combines the excess of loss and the Quota Share forms of coverage within one contract, with the reinsurance premium established as a fixed percentage of the Ceding Company‘s Subject Premium. After deducting the excess recovery on any one loss for one risk, the reinsurer indemnifies the Ceding Company based on a fixed Quota Share percentage. … Read more
Portion of an auto insurance policy that covers the damage to the policyholder’s car from a collision.
